Cision Ltd. (CISN) Reports Prelim. 4Q & FY17 Revenue Above Consensus; Offers FY18 EPS/Revneue Outlook Above Estimates
Cision Ltd. (NYSE: CISN) today reported select preliminary unaudited financial results for the fourth quarter and year ended December 31, 2017. Cision also announced today that it intends to reprice its $1,335 million First Lien Senior Secured Term Loan.
Fourth Quarter 2017 Preliminary Unaudited Financial Results
- Revenue estimated between $168.5 million and $169.0 million, reflecting between 13.5% and 13.8% growth versus prior year fourth quarter revenue of $148.5 million;
- Revenue, excluding the impact from purchase accounting, estimated between $169.0 million and $169.5 million, reflecting between 13.4% and 13.8% growth versus prior year fourth quarter revenue of $149.0 million;
- Operating income estimated between $7.0 million and $7.5 million, reflecting between 250% and 275% growth versus prior year fourth quarter operating income of $2.0 million;
- Net income (loss) estimated between $(23.2) million and $(27.6) million, reflecting between 2.5% and (16.0%) change versus prior year fourth quarter net income (loss) of $(23.8) million;
- Adjusted EBITDA estimated between $60.6 million and $61.2 million, reflecting between 14.3% and 15.4% growth versus prior year fourth quarter Adjusted EBITDA of $53.0 million;
- Adjusted net income estimated between $22.7 million and $22.9 million, reflecting between 187% and 190% growth versus prior year fourth quarter Adjusted net income of $7.9 million. Adjusted net income during the fourth quarter was impacted by incremental interest expense associated with our $75.0 million incremental term loan; and
- Adjusted net income per diluted share estimated between $0.19 and $0.19, reflecting between 86% and 90% growth versus prior year fourth quarter Adjusted net income per diluted share of $0.10.
Full Year 2017 Preliminary Unaudited Financial Results
- Revenue estimated between $631.0 million and $631.5 million, reflecting between 34.9% and 35.0% growth versus prior year revenue of $467.8 million;
- Revenue, excluding the impact from purchase accounting, estimated between $632.5 million and $633.0 million, reflecting between 34.9% and 35.0% growth versus prior year revenue of $468.9 million;
- Operating income estimated between $38.0 million and $38.5 million, reflecting an improvement of between $57.6 million and $58.1 million versus prior year operating loss of $19.6 million;
- Net income (loss) estimated between $(111.7) million and $(116.1) million, reflecting between (13.5%) and (18.0%) change versus prior year net income (loss) of $(98.4) million;
- Adjusted EBITDA estimated between $225.0 million and $225.5 million, reflecting between 38.7% and 39.0% growth versus prior year Adjusted EBITDA of $162.2 million;
- Including the acquisition of Bulletin Intelligence and the divestiture of Vintage, as if they both occurred on January 1, 2017, Adjusted EBITDA estimated between $227.0 million and $229.0 million;
- Adjusted net income estimated between $58.3 million and $58.5 million, reflecting between 163% and 164% growth versus prior year Adjusted net income of $22.2 million; and
- Adjusted net income per diluted share estimated between $0.57 and $0.57, reflecting between 111% and 112% growth versus prior fiscal year Adjusted net income per diluted share of $0.27.
We expect our net debt as of December 31, 2017 to be approximately $1,183 million. We derive net debt by taking our total debt outstanding and subtracting our cash balance. As of December 31, 2017, our total debt outstanding was approximately $1,331.6 million and our cash balance was approximately $148.7 million. We used approximately $75 million of cash in connection with our closing of the acquisition of PRIME Research on January 23, 2018.
"We are pleased to have delivered strong preliminary results for the fourth quarter," said Kevin Akeroyd, Cision's Chief Executive Officer. "We continue to focus our efforts on delivering best-in-class products and services to our customers, executing on our remaining synergies, and driving towards our long-term financial goals and objectives. This focus helped drive our fourth quarter organic growth rate to approximately 2.6%, after adjusting for non-core revenues, approximately $0.4 million of revenue from CEDROM-SNi and the impact of currency."
Cision has not yet finalized its financial statement close process for the quarter ended December 31, 2017, nor has it finalized its assessment of the impact of the recent tax legislation. As a result, the information in this statement is preliminary and based upon information available to the Company as of the date of the statement. In connection with the finalization process and the incorporation of the impact of the recent tax legislation, Cision may identify items that would require adjustments to its preliminary financial results announced herein. The Company's financial results could be different, and those differences could be material.
Full Year 2018 Outlook
Our initial outlook for the full fiscal year ending December 31, 2018 appears below:
- Revenue of between $716 million and $726 million;
- Revenue, excluding the impact from purchase accounting of between $720 million and $730 million;
- Net income of between $2 million and $4 million;
- Adjusted EBITDA of between $248 million and $254 million;
- Adjusted net income of between $105 million and $110 million; and
- Adjusted net income per share per of between $0.86 and $0.88.
Additionally, for the full fiscal year ending December 31, 2018, Cision expects:
- Depreciation expense of between $23 million and $26 million;
- Amortization expense of between $112 million and $115 million, with $22 million to $24 million of this amortization expense included within cost of revenue and the remainder included in general and administrative costs;
- Net interest expense, exclusive of debt extinguishment costs, of between $71 million and $74 million;
- Cash interest expense of between $61 million and $64 million;
- Stock-based compensation expense of between $5 million and $6 million; and
- Capital expenditures, inclusive of capitalized software development, of between $30 million and $35 million.
The above outlook assumes the completion of our First Lien Senior Secured Term Loan repricing, LIBOR of approximately 1.5%, and EURIBOR of approximately 0%, the inclusion of a full year of results from our acquisition of CEDROM-SNi, and the inclusion of 11 months of results from our acquisition of PRIME Research. CEDROM-SNi's revenues for the 12 months ended December 31, 2017 were approximately $15 million, and PRIME Research's revenues for the 12 months ended December 31, 2017 were approximately $45 million. The above outlook also assumes the following exchange rates with respect to the British Pound, the Euro and the Canadian Dollar for fiscal year 2018:
GBP to USD | 1.35 |
EUR to USD | 1.20 |
CAD to USD | 0.79 |
Additionally, our outlook for 2018 excludes any additional acquisitions, divestitures, or other unanticipated events. See discussion of non-GAAP financial measures below in this release.
Fourth Quarter 2017 Earnings Release and Conference Call Details
Cision expects to release its full year and fourth quarter 2017 financial and operating results on March 8, 2018. The Company plans to hold a conference call in connection with the above referenced release. The conference call will be simultaneously webcast on the Investor Relations section of the company's website: http://investors.cision.com