• Altair Announces Fourth Quarter and Full Year 2021 Financial Results

    Источник: Nasdaq GlobeNewswire / 24 фев 2022 15:05:03   America/Chicago

    TROY, Mich., Feb. 24, 2022 (GLOBE NEWSWIRE) -- Altair (Nasdaq: ALTR), a global leader in computational science and artificial intelligence today released its financial results for the fourth quarter and full year ended December 31, 2021.

    “Altair had an excellent fourth quarter and full year 2021, highlighted by year-on-year software product revenue growth of 15.8%,” said James Scapa, Founder, Chairman and Chief Executive Officer of Altair. “Our vision for driving smarter decisions with computational science and artificial intelligence is resonating with customers, our products continue to gain market share, and we are expanding our footprint across all verticals.”

    “Our fourth quarter 2021 financial performance was a fantastic end to an impressive year, with revenue and profit exceeding expectations and carrying momentum into 2022,” said Matt Brown, Chief Financial Officer of Altair. “We achieved software revenue growth in the mid-teens in 2021, while significantly improving our profitability, putting us well on track for our medium and long-term goals.”

    Fourth Quarter 2021 Financial Highlights

    • Software product revenue was $122.4 million compared to $113.6 million for the fourth quarter of 2020.
    • Total revenue was $140.8 million compared to $133.4 million for the fourth quarter of 2020.
    • Net loss was $(1.4) million compared to net income of $2.2 million for the fourth quarter of 2020. Diluted net loss per share was $(0.02) based on 79.0 million diluted weighted average common shares outstanding, compared to diluted net income per share of $0.03 for the fourth quarter of 2020, based on 78.5 million diluted weighted average common shares outstanding.
    • Adjusted EBITDA was $24.0 million, compared to $21.7 million for the fourth quarter of 2020.
    • Non-GAAP net income was $16.4 million, compared to non-GAAP net income of $14.5 million for the fourth quarter of 2020. Non-GAAP diluted net income per share was $0.19 based on 87.3 million non-GAAP diluted common shares outstanding, compared to non-GAAP diluted net income per share of $0.17 for the fourth quarter of 2020, based on 83.0 million non-GAAP diluted common shares outstanding.
    • Free cash flow was $5.0 million, compared to $3.4 million for the fourth quarter of 2020.

    Full Year 2021 Financial Highlights

    • Software product revenue was $453.7 million compared to $391.7 million for the full year of 2020.
    • Total revenue was $532.2 million compared to $469.9 million for the full year of 2020.
    • Net loss was $(8.8) million compared to net loss of $(10.5) million for the full year of 2020. Diluted net loss per share was $(0.12) based on 76.2 million diluted weighted average common shares outstanding, compared to diluted net loss per share of $(0.14) for the full year of 2020, based on 73.2 million diluted weighted average common shares outstanding.
    • Adjusted EBITDA was $85.3 million, compared to $57.3 million for the full year of 2020.
    • Non-GAAP net income was $57.6 million, compared to non-GAAP net income of $37.2 million for the full year of 2020. Non-GAAP diluted net income per share was $0.66 based on 87.3 million non-GAAP diluted common shares outstanding, compared to non-GAAP diluted net income per share of $0.45 for the full year of 2020, based on 83.0 million non-GAAP diluted common shares outstanding.
    • Free cash flow was $53.8 million, compared to $26.8 million for the full year of 2020.

    Business Outlook

    Based on information available as of today, Altair is issuing guidance for the first quarter and full year 2022.

       
    (in millions) First Quarter 2022  Full Year 2022 
    Software Product Revenue $134.0 to$137.0  $496.0 to$508.0 
    Total Revenue $152.0  $155.0  $568.0  $582.0 
    Net Income (Loss) $5.6  $7.5  $(23.1) $(13.4)
    Non-GAAP Net Income $25.2  $26.6  $65.3  $72.7 
    Adjusted EBITDA $36.0  $38.0  $96.0  $106.0 
    Net Cash Provided by Operating Activities         $12.2  $19.2 
    Free Cash Flow (1)         $5.0  $12.0 

    (1)   Includes $65.9 million payment in January 2022 for legal judgement acquired in December 2021.

    Conference Call Information

    What:Altair’s Fourth Quarter and Full Year 2021 Financial Results Conference Call
    When:Thursday, February 24, 2022
    Time:5 p.m. ET
    Live Call:(866) 754-5204, Domestic
     (636) 812-6621, International
    Replay:(855) 859-2056, Conference ID 8892192, Domestic
    (404) 537-3406, Conference ID 8892192, International
    Webcast:http://investor.altair.com  (live & replay)
      

    Non-GAAP Financial Measures

    This press release contains the following non-GAAP financial measures: Adjusted EBITDA, Non-GAAP Net Income, Non-GAAP Net Income Per Share and Free Cash Flow.

    Altair believes that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations. The Company’s management uses these non-GAAP measures to compare the Company’s performance to that of prior periods for trend analysis, for purposes of determining executive and senior management incentive compensation and for budgeting and planning purposes. The Company also believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other software companies, many of which present similar non-GAAP financial measures to investors.

    Adjusted EBITDA represents net income adjusted for income tax expense, interest expense, interest income and other, depreciation and amortization, stock-based compensation expense, restructuring charges, asset impairment charges and other special items as identified by management and described elsewhere in this press release.

    Non-GAAP net income excludes stock-based compensation, amortization of intangible assets related to acquisitions, restructuring charges, asset impairment charges, non-cash interest expense, other special items as identified by management and described elsewhere in this press release, and the impact of non-GAAP tax rate to income tax expense, which approximates our tax rate excluding discrete items and other specific events that can fluctuate from period to period.

    Non-GAAP diluted common shares includes total outstanding shares plus outstanding equity awards under the Company’s equity award plans.

    Free cash flow consists of cash flow from operations less capital expenditures.

    Company management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. Altair urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing quarterly financial results, including this press release, and not to rely on any single financial measure to evaluate the Company’s business.

    Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP financial measures used in this press release are included with the financial tables at the end of this release.

    About Altair

    Altair is a global leader in computational science and artificial intelligence (AI) that provides software and cloud solutions in the areas of simulation, high-performance computing (HPC), data analytics and AI. Altair enables organizations across all industries to compete more effectively and drive smarter decisions in an increasingly connected world – all while creating a greener, more sustainable future. To learn more, please visit www.altair.com.

    Cautionary Language Concerning Forward-Looking Statements

    This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, our guidance for the fourth quarter and full year 2021, our statements regarding our expectation for 2022, and our reconciliations of projected non-GAAP financial measures.  These forward-looking statements are made as of the date of this release and are based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “might,” “could,” “intend,” variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Altair’s control. Altair’s actual results could differ materially from those stated or implied in our forward-looking statements due to a number of factors, including but not limited to, the risks detailed in Altair’s quarterly and annual reports filed with the Securities and Exchange Commission as well as other documents that may be filed by the Company from time to time with the Securities and Exchange Commission. Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent Altair’s views as of the date of this press release. The Company anticipates that subsequent events and developments will cause its views to change. Altair undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing Altair’s views as of any date subsequent to the date of this press release.

    Media Relations
    Dave Simon
    Altair
    248-614-2400 ext. 332
    dls@altair.com

    Investor Relations
    The Blueshirt Group
    Monica Gould
    212-871-3927
    ir@altair.com

    Lindsay Savarese
    212-331-8417
    ir@altair.com


    ALTAIR ENGINERING INC. AND SUBSIDIARIES
    CONSOLIDATED BALANCE SHEETS
    (Unaudited)

      December 31, 
    (in thousands) 2021  2020 
    ASSETS        
    CURRENT ASSETS        
    Cash and cash equivalents $413,743  $241,221 
    Accounts receivable, net  137,561   117,878 
    Income tax receivable  9,388   6,736 
    Prepaid expenses and other current assets  27,529   21,100 
    Total current assets  588,221   386,935 
    Property and equipment, net  40,478   36,332 
    Operating lease right of use assets  28,494   33,526 
    Goodwill  370,178   264,481 
    Other intangible assets, net  99,057   76,114 
    Deferred tax assets  8,495   7,125 
    Other long-term assets  28,352   25,389 
    TOTAL ASSETS $1,163,275  $829,902 
    LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY        
    CURRENT LIABILITIES        
    Current portion of long-term debt $—  $29,962 
    Accounts payable  6,647   8,594 
    Accrued compensation and benefits  42,307   34,772 
    Current portion of operating lease liabilities  9,933   10,331 
    Other accrued expenses and current liabilities  122,226   31,404 
    Deferred revenue  93,160   85,691 
    Convertible senior notes, net  199,705   — 
    Total current liabilities  473,978   200,754 
    Convertible senior notes, net  —   188,300 
    Operating lease liabilities, net of current portion  19,550   24,323 
    Deferred revenue, non-current  12,872   9,388 
    Other long-term liabilities  42,894   27,767 
    TOTAL LIABILITIES  549,294   450,532 
    Commitments and contingencies        
    MEZZANINE EQUITY  784   784 
    STOCKHOLDERS’ EQUITY        
    Preferred stock ($0.0001 par value), authorized 45,000 shares, none issued or outstanding  —   — 
    Common stock ($0.0001 par value)        
    Class A common stock, authorized 513,797 shares, issued and outstanding 51,524 and 44,216 shares as of December 31, 2021 and 2020, respectively  5   4 
    Class B common stock, authorized 41,203 shares, issued and outstanding 27,745 and 30,111 shares as of December 31, 2021 and 2020, respectively  3   3 
    Additional paid-in capital  724,226   474,669 
    Accumulated deficit  (102,087)  (93,293)
    Accumulated other comprehensive loss  (8,950)  (2,797)
    TOTAL STOCKHOLDERS’ EQUITY  613,197   378,586 
    TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY $1,163,275  $829,902 


    ALTAIR ENGINEERING INC. AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF OPERATIONS
    (Unaudited)

      For the Three Months Ended
    December 31,    		  For the Year Ended
    December 31,    		 
    (in thousands, except per share data) 2021  2020  2021  2020 
    Revenue                
    License $94,178  $76,381  $324,808  $259,965 
    Maintenance and other services  28,180   37,244   128,938   131,746 
    Total software  122,358   113,625   453,746   391,711 
    Software related services  8,594   7,906   31,823   26,454 
    Total software and related services  130,952   121,531   485,569   418,165 
    Client engineering services  8,277   9,934   39,282   44,320 
    Other  1,568   1,976   7,328   7,436 
    Total revenue  140,797   133,441   532,179   469,921 
    Cost of revenue                
    License  6,223   6,786   19,929   19,637 
    Maintenance and other services  12,494   10,105   47,862   38,688 
    Total software *  18,717   16,891   67,791   58,325 
    Software related services  5,645   6,102   23,205   21,243 
    Total software and related services  24,362   22,993   90,996   79,568 
    Client engineering services  6,547   8,067   31,710   35,684 
    Other  1,888   1,631   6,960   6,053 
    Total cost of revenue  32,797   32,691   129,666   121,305 
    Gross profit  108,000   100,750   402,513   348,616 
    Operating expenses:                
    Research and development *  38,177   34,966   151,049   126,081 
    Sales and marketing *  38,182   30,537   132,750   111,440 
    General and administrative *  23,517   22,933   91,500   86,432 
    Amortization of intangible assets  4,433   4,986   18,357   16,376 
    Other operating (income) loss, net  (956)  5   (3,482)  (3,426)
    Total operating expenses  103,353   93,427   390,174   336,903 
    Operating income  4,647   7,323   12,339   11,713 
    Interest expense  3,067   3,008   12,065   11,598 
    Other (income) loss, net  (1,105)  (65)  562   (1,917)
    Income (loss) before income taxes  2,685   4,380   (288)  2,032 
    Income tax expense  4,082   2,182   8,506   12,532 
    Net (loss) income $(1,397) $2,198  $(8,794) $(10,500)
    (Loss) income per share:                
    Net (loss) income per share attributable to common stockholders, basic $(0.02) $0.03  $(0.12) $(0.14)
    Net (loss) income per share attributable to common stockholders, diluted $(0.02) $0.03  $(0.12) $(0.14)
    Weighted average shares outstanding:                
    Weighted average number of shares used in computing net (loss) income per share, basic  79,008   74,020   76,179   73,241 
    Weighted average number of shares used in computing net (loss) income per share, diluted  79,008   78,484   76,179   73,241 

    *        Amounts include stock-based compensation expense as follows (in thousands):

      (Unaudited) 
      Three Months Ended
    December 31,    		  Twelve Months Ended
    December 31,    		 
      2021  2020  2021  2020 
    Cost of revenue-software $1,828  $871  $5,619  $2,473 
    Research and development  5,338   2,686   16,561   8,372 
    Sales and marketing  4,244   2,474   15,044   6,423 
    General and administrative  1,910   1,385   7,325   4,087 
    Total stock-based compensation expense $13,320  $7,416  $44,549  $21,355 


    ALTAIR ENGINEERING INC. AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF CASH FLOW
    (Unaudited)

      Year Ended December 31, 
    (in thousands) 2021  2020 
    OPERATING ACTIVITIES:        
    Net loss $(8,794) $(10,500)
    Adjustments to reconcile net loss to net cash provided by operating activities:        
    Depreciation and amortization  25,644   23,806 
    Provision for credit loss  514   1,259 
    Amortization of debt discount and issuance costs  11,428   10,829 
    Stock-based compensation expense  44,549   21,355 
    Deferred income taxes  (1,502)  (10,350)
    Other, net  757   118 
    Changes in assets and liabilities:        
    Accounts receivable  (15,645)  (11,032)
    Prepaid expenses and other current assets  (9,026)  (2,131)
    Other long-term assets  (6,682)  (4,527)
    Accounts payable  (3,857)  (1,839)
    Accrued compensation and benefits  7,761   1,985 
    Other accrued expenses and current liabilities  6,365   5,629 
    Deferred revenue  10,111   8,280 
    Net cash provided by operating activities  61,623   32,882 
    INVESTING ACTIVITIES:        
    Payments for acquisition of businesses, net of cash acquired  (53,983)  (41,028)
    Capital expenditures  (7,849)  (6,093)
    Payments for acquisition of developed technology  (344)  (2,133)
    Other investing activities, net  (306)  162 
    Net cash used in investing activities  (62,482)  (49,092)
    FINANCING ACTIVITIES:        
    Proceeds from private placement of common stock  200,000   — 
    Payments on revolving commitment  (30,000)  — 
    Proceeds from employee stock purchase plan contributions  4,222   — 
    Proceeds from the exercise of common stock options  2,262   1,710 
    Borrowings under revolving commitment  —   30,000 
    Other financing activities  (537)  (460)
    Net cash provided by financing activities  175,947   31,250 
    Effect of exchange rate changes on cash, cash equivalents and restricted cash  (2,623)  3,010 
    Net increase in cash, cash equivalents and restricted cash  172,465   18,050 
    Cash, cash equivalents and restricted cash at beginning of year  241,547   223,497 
    Cash, cash equivalents and restricted cash at end of period $414,012  $241,547 
    Supplemental disclosures of cash flow:        
    Interest paid $633  $731 
    Income taxes paid $9,168  $12,666 
    Supplemental disclosure of non-cash investing and financing activities:        
    Issuance of common stock in connection with acquisitions $3,690  $3,504 
    Promissory notes issued and deferred payment obligations for acquisitions $86,936  $1,266 
    Finance leases $9  $118 
    Property and equipment in accounts payable and other current liabilities $1,056  $1,671 
             

    Financial Results

    The following table provides a reconciliation Adjusted EBITDA, Non-GAAP net income and Non-GAAP net income per share – diluted, to net loss and net loss per share – diluted, the most comparable GAAP financial measures:

      (Unaudited) 
      Three Months Ended
    December 31,    		  Twelve Months Ended
    December 31,    		 
    (in thousands, except per share amounts) 2021  2020  2021  2020 
    Net (loss) income $(1,397) $2,198  $(8,794) $(10,500)
    Stock-based compensation expense  13,320   7,416   44,549   21,355 
    Amortization of intangible assets  4,433   4,986   18,357   16,376 
    Non-cash interest expense  2,915   2,762   11,428   10,824 
    Restructuring expense  99   —   5,053   — 
    Impact of non-GAAP tax rate  (1,696)  (2,900)  (11,740)  (525)
    Special adjustments and other (1)  (1,229)  —   (1,229)  (372)
    Non-GAAP net income  16,445   14,462   57,624   37,158 
    Depreciation expense  1,856   1,904   7,287   7,430 
    Cash interest (income) expense  (114)  244   96   (357)
    Income tax expense, net of non-GAAP impact  5,778   5,082   20,246   13,057 
    Adjusted EBITDA $23,965  $21,692  $85,253  $57,288 
                     
    Net (loss) income per share, diluted $(0.02) $0.03  $(0.12) $(0.14)
    Non-GAAP net income per share, diluted $0.19  $0.17  $0.66  $0.45 
                     
    GAAP diluted shares outstanding:  79,008   78,484   76,179   73,241 
    Non-GAAP diluted shares outstanding:  87,300   83,000   87,300   83,000 

    (1)   The three and twelve months ended December 31, 2021, includes $1.2 million currency gains on acquisition-related intercompany loans. The twelve months ended December 31, 2020, includes $1.0 million of proceeds from settlements related to a historical acquisition and $0.6 million of severance expense.

    The following table provides a reconciliation of Free Cash Flow to net cash provided by operating activities, the most comparable GAAP financial measure:

      (Unaudited) 
      Three Months Ended
    December 31,    		  Twelve Months Ended
    December 31,    		 
    (in thousands) 2021  2020  2021  2020 
    Net cash provided by operating activities $6,029  $5,503  $61,623  $32,882 
    Capital expenditures  (1,038)  (2,087)  (7,849)  (6,093)
    Free Cash Flow $4,991  $3,416  $53,774  $26,789 


    Business Outlook

    The following table provides a reconciliation of projected Adjusted EBITDA and projected Non-GAAP net income to projected net income (loss), the most comparable GAAP financial measure:

      (Unaudited) 
      Three Months Ending
    March 31, 2022    		  Year Ending
    December 31, 2022    		 
    (in thousands) Low  High  Low  High 
    Net income (loss) $5,600  $7,500  $(23,100) $(13,400)
    Stock-based compensation expense  18,000   18,000   71,600   71,600 
    Amortization of intangible assets  5,900   5,900   23,000   23,000 
    Non-cash interest expense  300   300   1,300   1,300 
    Impact of non-GAAP tax rate  (4,600)  (5,100)  (7,500)  (9,800)
    Non-GAAP net income  25,200   26,600   65,300   72,700 
    Depreciation expense  1,900   1,900   7,400   7,400 
    Cash interest expense, net  100   100   300   300 
    Income tax expense, net of non-GAAP impact  8,800   9,400   23,000   25,600 
    Adjusted EBITDA $36,000  $38,000  $96,000  $106,000 

    The following table provides a reconciliation of projected Free Cash Flow to projected net cash provided by operating activities, the most comparable GAAP financial measure:

          (Unaudited) 
        Year Ending
    December 31, 2022    		 
    (in thousands)     Low  High 
    Net cash provided by operating activities (1)     $12,200  $19,200 
    Capital expenditures      (7,200)  (7,200)
    Free Cash Flow (1)     $5,000  $12,000 

    (1)   Includes $65.9 million payment in January 2022 for legal judgement acquired in December 2021.


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