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8-K - 8-K - Benefitfocus, Inc. | d700023d8k.htm |
Exhibit 99.1
Benefitfocus, Inc.
Consolidated Statements of Operations and Comprehensive Loss
(in thousands, except share and per share data)
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(Restated) | (Restated) | |||||||||||||||
Revenue |
$ | 30,256 | $ | 22,208 | $ | 104,752 | $ | 81,739 | ||||||||
Cost of revenue |
19,473 | 11,881 | 62,411 | 44,400 | ||||||||||||
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Gross profit |
10,783 | 10,327 | 42,341 | 37,339 | ||||||||||||
Operating expenses: |
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Sales and marketing |
8,976 | 6,357 | 36,072 | 27,905 | ||||||||||||
Research and development |
6,708 | 3,520 | 23,532 | 14,621 | ||||||||||||
General and administrative |
2,790 | 1,990 | 10,974 | 7,494 | ||||||||||||
Change in fair value of contingent consideration |
| (49 | ) | (43 | ) | 121 | ||||||||||
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Total operating expenses |
18,474 | 11,818 | 70,535 | 50,141 | ||||||||||||
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Loss from operations |
(7,691 | ) | (1,491 | ) | (28,194 | ) | (12,802 | ) | ||||||||
Other income (expense): |
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Interest income |
15 | 12 | 46 | 53 | ||||||||||||
Interest expense |
(552 | ) | (507 | ) | (2,149 | ) | (1,976 | ) | ||||||||
Other expense |
(66 | ) | (8 | ) | (95 | ) | (64 | ) | ||||||||
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Total other expense, net |
(603 | ) | (503 | ) | (2,198 | ) | (1,987 | ) | ||||||||
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Loss before income taxes |
(8,294 | ) | (1,994 | ) | (30,392 | ) | (14,789 | ) | ||||||||
Income tax (benefit) expense |
(12 | ) | 35 | (31 | ) | 84 | ||||||||||
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Net loss |
$ | (8,282 | ) | $ | (2,029 | ) | $ | (30,361 | ) | $ | (14,873 | ) | ||||
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Comprehensive loss |
$ | (8,282 | ) | $ | (2,029 | ) | $ | (30,361 | ) | $ | (14,873 | ) | ||||
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Net loss per common share: |
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Basic and diluted |
$ | (0.34 | ) | $ | (0.42 | ) | $ | (2.99 | ) | $ | (3.09 | ) | ||||
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Weighted-average common shares outstanding: |
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Basic and diluted |
24,474,566 | 4,842,205 | 10,144,243 | 4,812,632 | ||||||||||||
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Benefitfocus, Inc.
Consolidated Balance Sheets
(in thousands, except share and per share data)
As of December 31, | ||||||||
2013 | 2012 | |||||||
(Restated) | ||||||||
Assets |
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Current assets: |
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Cash and cash equivalents |
$ | 65,645 | $ | 19,703 | ||||
Marketable securities |
13,168 | | ||||||
Accounts receivable, net |
23,668 | 13,372 | ||||||
Prepaid expenses and other current assets |
4,322 | 1,482 | ||||||
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Total current assets |
106,803 | 34,557 | ||||||
Property and equipment, net |
27,444 | 20,456 | ||||||
Intangible assets, net |
1,256 | 1,579 | ||||||
Goodwill |
1,634 | 1,634 | ||||||
Other non-current assets |
2,474 | | ||||||
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Total assets |
$ | 139,611 | $ | 58,226 | ||||
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Liabilities, redeemable convertible preferred stock and stockholders equity (deficit) |
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Current liabilities: |
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Accounts payable |
$ | 4,354 | $ | 1,726 | ||||
Accrued expenses |
3,911 | 2,453 | ||||||
Accrued compensation and benefits |
14,183 | 9,661 | ||||||
Deferred revenue, current portion |
15,158 | 11,165 | ||||||
Financing and capital lease obligations, current portion |
4,288 | 1,228 | ||||||
Notes payable, current portion |
| 2,420 | ||||||
Contingent consideration related to acquisition, current portion |
| 328 | ||||||
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Total current liabilities |
41,894 | 28,981 | ||||||
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Deferred revenue, net of current portion |
65,063 | 46,355 | ||||||
Revolving line of credit |
5,757 | | ||||||
Financing and capital lease obligations, net of current portion |
14,263 | 9,589 | ||||||
Notes payable, net of current portion |
| 3,561 | ||||||
Other non-current liabilities |
1,202 | 871 | ||||||
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Total liabilities |
128,179 | 89,357 | ||||||
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Commitments and contingencies |
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Redeemable convertible preferred stock: |
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Convertible Series A preferred stock, no par value, no shares authorized, issued and outstanding at December 31, 2013; 14,055,851 shares authorized, issued and outstanding at December 31, 2012 |
| 105,505 | ||||||
Convertible Series B preferred stock, no par value, no shares authorized, issued and outstanding at December 31, 2013; 2,441,009 shares authorized, issued and outstanding at December 31, 2012 |
| 29,973 | ||||||
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Total redeemable convertible preferred stock |
| 135,478 | ||||||
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Stockholders equity (deficit): |
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Preferred stock, par value $0.001, 5,000,000 shares authorized, no shares issued and outstanding at December 31, 2013 and 2012 |
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Common stock, no par value, no shares authorized issued and outstanding at December 31, 2013; 100,000,000 shares authorized, 20,125,063 shares issued and 4,792,347 shares outstanding at December 31, 2012 |
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6,109 |
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Common stock, par value $0.001, 50,000,000 shares authorized, 24,495,651 shares issued and outstanding at December 31, 2013; no shares authorized, issued and outstanding at December 31, 2012 |
24 | | ||||||
Additional paid-in capital |
214,487 | | ||||||
Accumulated deficit |
(203,079 | ) | (172,718 | ) | ||||
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Total stockholders equity (deficit) |
11,432 | (166,609 | ) | |||||
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Total liabilities, redeemable convertible preferred stock and stockholders equity (deficit) |
$ | 139,611 | $ | 58,226 | ||||
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Benefitfocus.com, Inc.
Consolidated Statements of Cash Flows
(in thousands)
Three Months Ended December 31, |
Year Ended December 31, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(Restated) | (Restated) | |||||||||||||||
Cash flows from operating activities |
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Net loss |
$ | (8,282 | ) | $ | (2,029 | ) | $ | (30,361 | ) | $ | (14,873 | ) | ||||
Adjustments to reconcile net loss to net cash and cash equivalents provided by operating activities: |
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Depreciation and amortization |
2,246 | 1,794 | 8,172 | 8,560 | ||||||||||||
Stock-based compensation expense |
381 | 248 | 1,202 | 712 | ||||||||||||
Change in fair value and accretion of warrant |
223 | 168 | 892 | 488 | ||||||||||||
Interest accrual on financing obligation |
443 | 444 | 1,768 | 1,774 | ||||||||||||
Change in fair value of contingent consideration |
1 | (37 | ) | (17 | ) | 188 | ||||||||||
Provision for doubtful accounts |
(87 | ) | 18 | (32 | ) | 98 | ||||||||||
Loss on disposal of property and equipment |
45 | 8 | 65 | 17 | ||||||||||||
Changes in operating assets and liabilities: |
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Accounts receivable, net |
(2,404 | ) | (1,974 | ) | (10,264 | ) | (4,411 | ) | ||||||||
Prepaid expenses and other current assets |
(428 | ) | 411 | (1,440 | ) | 639 | ||||||||||
Accounts payable |
(1,246 | ) | 457 | 2,625 | 862 | |||||||||||
Accrued expenses |
138 | 76 | 904 | 532 | ||||||||||||
Accrued compensation and benefits |
(1,555 | ) | (557 | ) | 4,521 | 3,102 | ||||||||||
Contingent consideration related to acquisition |
| | | (320 | ) | |||||||||||
Deferred revenue |
7,863 | 5,582 | 22,701 | 14,747 | ||||||||||||
Other non-current liabilities |
97 | 73 | 331 | 293 | ||||||||||||
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Net cash and cash equivalents (used in) provided by operating activities |
(2,565 | ) | 4,682 | 1,067 | 12,408 | |||||||||||
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Cash flows from investing activities |
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Purchases of short-term investments held to maturity |
(13,168 | ) | | (13,168 | ) | | ||||||||||
Purchases of property and equipment |
(2,223 | ) | (1,154 | ) | (8,918 | ) | (6,308 | ) | ||||||||
Proceeds from sale of property and equipment |
| | 9 | | ||||||||||||
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Net cash and cash equivalents used in investing activities |
(15,391 | ) | (1,154 | ) | (22,077 | ) | (6,308 | ) | ||||||||
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Cash flows from financing activities |
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Proceeds from initial public offering, net of issuance costs |
| | 70,064 | | ||||||||||||
Draws on revolving line of credit |
| | 10,757 | | ||||||||||||
Payments on revolving line of credit |
| | (5,000 | ) | | |||||||||||
Proceeds from notes payable borrowing |
| 4,535 | 1,465 | 4,535 | ||||||||||||
Repayment of notes payable |
| (239 | ) | (7,447 | ) | (1,074 | ) | |||||||||
Proceeds from exercises of stock options |
127 | 24 | 699 | 108 | ||||||||||||
Proceeds from issuance of common stock (excluding IPO) |
| | 68 | | ||||||||||||
Repurchases of common stock |
| (6 | ) | | (599 | ) | ||||||||||
Payments of contingent consideration |
(311 | ) | (378 | ) | (311 | ) | (2,078 | ) | ||||||||
Payments on financing and capital lease obligations |
(887 | ) | (745 | ) | (3,343 | ) | (3,145 | ) | ||||||||
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Net cash and cash equivalents provided by (used in) financing activities |
(1,071 | ) | 3,191 | 66,952 | (2,253 | ) | ||||||||||
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Net increase (decrease) in cash and cash equivalents |
(19,027 | ) | 6,719 | 45,942 | 3,847 | |||||||||||
Cash and cash equivalents, beginning of period |
84,672 | 12,984 | 19,703 | 15,856 | ||||||||||||
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Cash and cash equivalents, end of year |
$ | 65,645 | $ | 19,703 | $ | 65,645 | $ | 19,703 | ||||||||
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Benefitfocus, Inc.
Reconciliation of GAAP to Non-GAAP Measures
For the Three Months and Years Ended December 31, 2013 and 2012
(unaudited, dollars in thousands except share and per share data)
Three Months December 31, | Year Ended December 31, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(Restated) | (Restated) | |||||||||||||||
Reconciliation from Gross Profit to Adjusted Gross Profit: |
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Gross profit |
$ | 10,783 | $ | 10,327 | $ | 42,341 | $ | 37,339 | ||||||||
Depreciation |
1,186 | 1,053 | 4,257 | 4,224 | ||||||||||||
Amortization of software development costs |
714 | 485 | 2,618 | 3,149 | ||||||||||||
Amortization of acquired intangible assets |
58 | 64 | 245 | 254 | ||||||||||||
Stock-based compensation expense |
86 | 69 | 274 | 195 | ||||||||||||
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Adjusted gross profit |
$ | 12,827 | $ | 11,998 | $ | 49,735 | $ | 45,161 | ||||||||
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Reconciliation from Operating Loss to Non-GAAP Operating Loss: |
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Operating loss |
$ | (7,691 | ) | $ | (1,491 | ) | $ | (28,194 | ) | $ | (12,802 | ) | ||||
Amortization of acquired intangible assets |
76 | 84 | 323 | 335 | ||||||||||||
Stock-based compensation expense |
381 | 248 | 1,202 | 712 | ||||||||||||
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Total net adjustments |
$ | 457 | $ | 332 | $ | 1,525 | $ | 1,047 | ||||||||
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Non-GAAP operating loss |
$ | (7,234 | ) | $ | (1,159 | ) | $ | (26,669 | ) | $ | (11,755 | ) | ||||
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Reconciliation from Net Loss to Adjusted EBITDA: |
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Net loss |
$ | (8,282 | ) | $ | (2,029 | ) | $ | (30,361 | ) | $ | (14,873 | ) | ||||
Depreciation |
1,456 | 1,225 | 5,231 | 5,076 | ||||||||||||
Amortization of software development costs |
714 | 485 | 2,618 | 3,149 | ||||||||||||
Amortization of acquired intangible assets |
76 | 84 | 323 | 335 | ||||||||||||
Interest income |
(15 | ) | (12 | ) | (46 | ) | (53 | ) | ||||||||
Interest expense |
552 | 507 | 2,149 | 1,976 | ||||||||||||
Income tax (benefit) expense |
(12 | ) | 35 | (31 | ) | 84 | ||||||||||
Stock-based compensation expense |
381 | 248 | 1,202 | 712 | ||||||||||||
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Total net adjustments |
$ | 3,152 | $ | 2,572 | $ | 11,446 | $ | 11,279 | ||||||||
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Adjusted EBITDA |
$ | (5,130 | ) | $ | 543 | $ | (18,915 | ) | $ | (3,594 | ) | |||||
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Reconciliation from Net Loss to Non-GAAP Net Loss: |
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Net loss |
$ | (8,282 | ) | $ | (2,029 | ) | $ | (30,361 | ) | $ | (14,873 | ) | ||||
Amortization of acquired intangible assets |
76 | 84 | 323 | 335 | ||||||||||||
Stock-based compensation expense |
381 | 248 | 1,202 | 712 | ||||||||||||
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Total net adjustments |
457 | 332 | 1,525 | 1,047 | ||||||||||||
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Non-GAAP net loss |
(7,825 | ) | (1,697 | ) | (28,836 | ) | (13,826 | ) | ||||||||
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Calculation of Non-GAAP Earnings Per Share: |
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Non-GAAP net loss |
$ | (7,825 | ) | $ | (1,697 | ) | $ | (28,836 | ) | $ | (13,826 | ) | ||||
Weighted average shares outstanding - basic and diluted |
24,474,566 | 4,842,205 | 10,144,243 | 4,812,632 | ||||||||||||
Additional weighted average shares giving effect to conversion of convertible preferred stock at the beginning of the period |
| 16,496,860 | 12,022,369 | 16,496,860 | ||||||||||||
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Shares used in computing non-GAAP net loss per share - basic and diluted |
24,474,566 | 21,339,065 | 22,166,612 | 21,309,492 | ||||||||||||
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Non-GAAP net loss per common share - basic and diluted |
$ | (0.32 | ) | $ | (0.08 | ) | $ | (1.30 | ) | $ | (0.65 | ) | ||||
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