$800 MillionFacility Strengthens Financial Position By Providing More Attractive Credit Terms & Flexibility Preserving Strong Liquidity Position
Extends Facility Maturity Date to May 2029
BOCA RATON, Fla.–(BUSINESS WIRE)–May 9, 2024–
The ODP Corporation (NASDAQ:ODP) (“ODP,” or the “Company”), a leading provider of business services, products and digital workplace technology solutions to businesses and consumers, today announced that it has amended and extended its existing asset-based credit facility. The amendment extends the maturity date to May 2029. The renewed $800 million facility includes certain more attractive credit terms and conditions, enhancing the company’s balance sheet and liquidity position to support future growth.
“The extension of our credit facility is a validation of our strong financial position and business model,” said Gerry Smith, chief executive officer of The ODP Corporation. “I want to thank our syndicate members for their strong support of our business and to our commitment to driving operational excellence throughout the enterprise.”
“The successful renewal of our asset-based credit facility includes improved credit terms and conditions, and extends our maturity, providing ample liquidity to manage our growth and capital allocation plans,” said Tim Perrott, vice president, investor relations and treasurer of The ODP Corporation. “We are thrilled to have the continued support of our financial partners as we continue to pursue our strategic objectives.”
The renewed credit facility was significantly oversubscribed with strong lender support, providing additional financial flexibility to grow the business and to enhance returns for shareholders.
About The ODP Corporation The ODP Corporation (NASDAQ:ODP) is a leading provider of products and services through an integrated business-to-business (B2B) distribution platform and omnichannel presence, which includes world-class supply chain and distribution operations, dedicated sales professionals, a B2B digital procurement solution, online presence and a network of Office Depot and OfficeMax retail stores. Through its operating companies Office Depot, LLC; ODP Business Solutions, LLC; Veyer, LLC; and Varis, Inc., The ODP Corporation empowers every business, professional, and consumer to achieve more every day. For more information, visit theodpcorp.com.
ODP and ODP Business Solutions are trademarks of ODP Business Solutions, LLC. Office Depot is a trademark of The Office Club, LLC. OfficeMax is a trademark of OMX, Inc. Veyer is a trademark of Veyer, LLC. Varis is a trademark of Varis, Inc. Grand&Toy is a trademark of Grand & Toy, LLC in Canada. Any other product or company names mentioned herein are the trademarks of their respective owners.
Q1 operating earnings of $26.8 million, or up 34% on an adjusted basis
Q1 revenue down following sale of European staffing operations; down 2.6% on an organic basis
Q1 adjusted EBITDA margin increased 110 basis points to 3.2% driven by meaningful reduction in operating expenses resulting from business transformation initiatives and sale of European staffing operations
Company expects further expansion of EBITDA margin from the planned Q2 2024 acquisition of Motion Recruitment Partners, LLC (“MRP”) and ongoing transformation actions
TROY, Mich., May 09, 2024 (GLOBE NEWSWIRE) — Kelly (Nasdaq: KELYA, KELYB), a leading specialty talent solutions provider, today announced results for the first quarter of 2024.
Peter Quigley, president and chief executive officer, announced revenue for the first quarter of 2024 totaled $1.05 billion, a 17.6% decrease, compared to the corresponding quarter of 2023 resulting primarily from the sale of the company’s European staffing operations on January 2, 2024. Excluding the impact of the sale of the European staffing operations, revenue declined 2.6% on an organic basis reflecting the continuing impact of customers’ more guarded approach to hiring and initiating new projects or capital spending.
Kelly reported operating earnings in the first quarter of 2024 of $26.8 million, compared to earnings of $10.7 million reported in the first quarter of 2023. Earnings in the first quarter of 2024 include an $11.6 million gain on the sale of our European staffing operations and $7.9 million of charges related to transformation actions and the sale of our European staffing operations. Excluding those charges, adjusted earnings were $23.1 million in the first quarter of 2024. Earnings in the first quarter of 2023 included $6.6 million of restructuring charges and adjusted earnings from operations were $17.3 million. The European staffing operations were break even on an adjusted basis in the first quarter of 2023. Excluding the impact of the sale in both periods, 2024 adjusted earnings improved primarily as a result of lower selling, general and administrative expenses, partially offset by lower revenue and unfavorable business mix and lower permanent placement fees which resulted in lower gross profit.
Earnings per share in the first quarter of 2024 were $0.70 compared to earnings per share of $0.29 in the first quarter of 2023. Included in earnings per share in the first quarter of 2024 were a gain on sale and gain on forward contract, net of tax, of $0.31 partially offset by restructuring and transaction-related charges, net of tax, of $0.17. Included in the earnings per share in the first quarter of 2023 is a $0.13 per share restructuring charge, net of tax. On an adjusted basis, earnings per share were $0.56 in the first quarter of 2024, an improvement from $0.42 per share in the corresponding quarter of 2023.
On May 3, Kelly announced that it had entered into a definitive agreement to acquire MRP and expects the transaction to close in the second quarter of 2024.
“In the first quarter, we continued making progress on our journey to accelerate profitable growth notwithstanding continued macroeconomic uncertainty and industry headwinds. Our ongoing growth and efficiency initiatives increased Kelly’s adjusted EBITDA margin to 3.2% – a significant improvement of 110 basis points over the prior year and well above the company’s recent average,” said Quigley. “Our more streamlined and profitable portfolio of businesses is poised to realize additional benefits from the transformational acquisition of MRP. When completed in the second quarter, this acquisition will strengthen Kelly’s scale and capabilities and meaningfully increase market share across several key areas, which in turn creates exciting opportunities for future revenue growth and additional EBITDA margin expansion.”
Kelly also reported that on May 7, its board of directors declared a dividend of $0.075 per share. The dividend is payable on June 4, 2024, to stockholders of record as of the close of business on May 20, 2024.
In conjunction with its first-quarter earnings release, Kelly has published a financial presentation on the Investor Relations page of its public website and will host a conference call at 9 a.m. ET on May 9 to review the results and answer questions. The call may be accessed in one of the following ways:
Via the Telephone (877) 692-8955 (toll free) or (234) 720-6979 (caller paid) Enter access code 5728672 After the prompt, please enter “#”
A recording of the conference call will be available after 1:30 p.m. ET on May 9, 2024, at (866) 207-1041 (toll-free) and (402) 970-0847 (caller-paid). The access code is 1646639#. The recording will also be available at kellyservices.com during this period.
This release contains statements that are forward looking in nature and, accordingly, are subject to risks and uncertainties. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about Kelly’s financial expectations, are forward-looking statements. Factors that could cause actual results to differ materially from those contained in this release include, but are not limited to, (i) changing market and economic conditions, (ii) disruption in the labor market and weakened demand for human capital resulting from technological advances, loss of large corporate customers and government contractor requirements, (iii) the impact of laws and regulations (including federal, state and international tax laws), (iv) unexpected changes in claim trends on workers’ compensation, unemployment, disability and medical benefit plans, (v) litigation and other legal liabilities (including tax liabilities) in excess of our estimates, (vi) our ability to achieve our business’s anticipated growth strategies, (vii) our future business development, results of operations and financial condition, (viii) damage to our brands, (ix) dependency on third parties for the execution of critical functions, (x) conducting business in foreign countries, including foreign currency fluctuations, (xi) availability of temporary workers with appropriate skills required by customers, (xii) cyberattacks or other breaches of network or information technology security, and (xiii) other risks, uncertainties and factors discussed in this release and in the Company’s filings with the Securities and Exchange Commission. In some cases, forward-looking statements can be identified by words or phrases such as “may,” “will,” “expect,” “anticipate,” “target,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or other similar expressions. All information provided in this press release is as of the date of this press release and we undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations.
About Kelly®
Kelly Services, Inc. (Nasdaq: KELYA, KELYB) helps companies recruit and manage skilled workers and helps job seekers find great work. Since inventing the staffing industry in 1946, we have become experts in the many industries and local and global markets we serve. With a network of suppliers and partners around the world, we connect more than 500,000 people with work every year. Our suite of outsourcing and consulting services ensures companies have the people they need, when and where they are needed most. Headquartered in Troy, Michigan, we empower businesses and individuals to access limitless opportunities in industries such as science, engineering, technology, education, manufacturing, retail, finance, and energy. Revenue in 2023 was $4.8 billion. Learn more at kellyservices.com.
PHOENIX, May 09, 2024 (GLOBE NEWSWIRE) — QuoteMedia, a leading financial market data and financial technology solutions provider, continues to expand their global data offerings by adding support for the Cboe One Canada Feed, a real-time Canadian equities market data solution offered by Cboe Global Markets. The Feed aims to provide complete coverage of the Canadian equities market by aggregating data from all four trading venues operated by Cboe Canada and trading volume from all Canadian markets. Notably, it also includes unique coverage of more than 260 securities that are listed on Cboe Canada.
“We are thrilled to announce our support for the Cboe One Canada Feed, further enhancing our range of exchange price feeds available to our clients,” said Dave Shworan, CEO of QuoteMedia Ltd. “This collaboration enables us to offer more options for accessing reliable real-time market data, empowering investors to make informed decisions.”
Cboe Canada is the third most active marketplace in Canada, consistently representing close to 15% of all volume traded in Canadian-listed securities. The Cboe One Canada Feed will be integrated across all QuoteMedia enterprise and subscription products, giving users the flexibility to choose from a variety of exchange price feeds that best suit their needs.
“Cboe aims to deliver world-class solutions and services across all the markets in which we operate globally, and our dedication to Canada is no exception,” said Adam Inzirillo, Global Head of Data and Access Solutions at Cboe Global Markets. “Our Cboe One Canada Feed is designed to offer seamless and efficient access to data on all Canadian-listed securities, reflecting our commitment to driving continuous product innovation within this market, and we couldn’t be more pleased to collaborate with QuoteMedia to broaden market data accessibility for the industry.”
About QuoteMedia QuoteMedia is a leading software developer and cloud-based syndicator of financial market information and streaming financial data solutions to media, corporations, online brokerages, and financial services companies. The Company licenses interactive stock research tools such as streaming real-time quotes, market research, news, charting, option chains, filings, corporate financials, insider reports, market indices, portfolio management systems, and data feeds. QuoteMedia provides industry leading market data solutions and financial services for companies such as the Nasdaq Stock Exchange, TMX Group (TSX Stock Exchange), Canadian Securities Exchange (CSE), London Stock Exchange Group, FIS, U.S. Bank, Bank of Montreal (BMO), Broadridge Financial Systems, JPMorgan Chase, Scotiabank, CI Financial, Canaccord Genuity Corp., Hilltop Securities, Avantax, Zacks Investment Research, General Electric, Boeing, Bombardier, Telus International, Business Wire, PR Newswire, The Goldman Sachs Group, Regal Securities, ChoiceTrade, Cetera Financial Group, Dynamic Trend, Inc., Aviso Financial Inc., CNW Group, iA Private Wealth, Ally Invest, Inc., Suncor, Leede Jones Gable, Firstrade Securities, Charles Schwab, First Financial, Equisolve, Stock-Trak, Mergent, Cision and others. For more information, please visit www.quotemedia.com.
Higher Occupancy Propels Strong Quarterly Financial Performance Capital Strategy Highlights Include Significant Share Buyback and Debt Refinancing in Quarter
BRENTWOOD, Tenn., May 08, 2024 (GLOBE NEWSWIRE) — CoreCivic, Inc. (NYSE: CXW) (the Company) announced today its financial results for the first quarter of 2024. Damon T. Hininger, CoreCivic’s President and Chief Executive Officer, commented, “CoreCivic experienced a strong first quarter of 2024. Propelled by 75.2% occupancy – our highest level since the first quarter of 2020 – CoreCivic generated sturdy margins and year-over-year growth in our key metrics. Revenue increased 9% versus the first quarter of 2023, with Federal, State, and Local revenues all increasing, and our cost-management initiatives also contributed to our favorable results.”
Commenting on capital market activities for the quarter, Hininger added, “In addition to the strong quarterly financial results, we are equally pleased with the continued progress we have made on our capital structure initiatives. During the quarter, we repurchased 2.7 million shares of our common stock for $39.4 million – an acceleration over recent quarters. Also, during the quarter, we successfully issued $500 million of new senior unsecured notes, effectively refinancing and extending the term of our existing debt by roughly three years at the same rate as the senior unsecured notes that we issued in 2021, when interest rates were much lower. Even with those activities, we ended the quarter with leverage, measured as net debt to Adjusted EBITDA, at 2.7x for the trailing twelve months – placing us, for the first time, within our target leverage range of 2.25x to 2.75x that we established in August 2020. This is a significant accomplishment, and we are proud of the strategy, focus, and discipline that led us here.”
“We are thankful for our many partners. Our federal, state, and local government partners continue to trust the essential solutions CoreCivic provides, and we renewed the eight contracts that were up for renewal during the quarter – following a year in which we renewed all of the 34 contracts up for renewal. We are also thankful to our financial partners for their ongoing support, including of our recent debt refinancing.”
Financial Highlights – First Quarter 2024
Total revenue of $500.7 million
CoreCivic Safety revenue of $457.7 million
CoreCivic Community revenue of $29.9 million
CoreCivic Properties revenue of $13.0 million
Net income of $9.5 million; Adjusted net income of $27.9 million
Diluted earnings per share of $0.08
Adjusted Diluted EPS of $0.25
Normalized FFO per diluted share of $0.46
Adjusted EBITDA of $89.5 million
First Quarter 2024 Financial Results Compared With First Quarter 2023
Net income in the first quarter of 2024 was $9.5 million, or $0.08 per diluted share, compared with net income in the first quarter of 2023 of $12.4 million, or $0.11 per diluted share. However, when adjusted for special items, adjusted net income for the first quarter of 2024 improved to $27.9 million, or $0.25 per diluted share (Adjusted Diluted EPS), compared with adjusted net income in the first quarter of 2023 of $14.7 million, or $0.13 per diluted share. Special items for each period are presented in detail in the calculation of Adjusted Diluted EPS in the Supplemental Financial Information following the financial statements presented herein and, most notably, included $27.2 million of expenses associated with debt repayments and refinancing transactions in the first quarter of 2024.
The increased adjusted per share amounts resulted from higher federal, state, and local populations, particularly at our facilities serving U.S. Immigration & Customs Enforcement (ICE), combined with lower interest expense and a decrease in shares outstanding, both resulting from our capital allocation strategy. These earnings increases were partially offset by the expiration of our lease with the Oklahoma Department of Corrections (ODC) at our North Fork Correctional Facility on June 30, 2023.
Our labor attraction and retention initiatives continue to generate positive results. The costs of registry nursing, temporary labor resources, including associated travel expenses, overtime and incentives, declined meaningfully from the prior year quarter as well as sequentially.
Revenue from ICE, our largest partner, increased significantly versus the same quarter of 2023, when Title-42 restrictions were still in effect, and ICE revenue was essentially flat versus the fourth quarter of 2023. Under Title 42, which ended May 11, 2023, asylum-seekers and anyone crossing the border without proper documentation or authority were denied entry at the United States border to contain the spread of COVID-19. During the three months ended March 31, 2024, revenue from ICE was $153.8 million compared to $130.7 million during the three months ended March 31, 2023.
Earnings before interest, taxes, depreciation and amortization (EBITDA) was $62.8 million in the first quarter of 2024. Adjusted EBITDA, which excludes special items, was $89.5 million in the first quarter of 2024, compared with $73.7 million in the first quarter of 2023. The increase in Adjusted EBITDA was attributable to an increase in occupancy, combined with a general reduction in temporary staffing incentives and related labor costs, partially offset by the expiration of the lease with the ODC at the North Fork facility.
Funds From Operations (FFO) for the first quarter of 2024 was $33.9 million. Normalized FFO, which excludes special items, increased to $52.6 million, or $0.46 per diluted share, in the first quarter of 2024, compared with $38.9 million, or $0.34 per diluted share, in the first quarter of 2023, representing an increase in Normalized FFO per share of 35%. Normalized FFO was impacted by the same factors that affected Adjusted EBITDA, further improved by a reduction in interest expense resulting from our debt reduction strategy that is not reflected in Adjusted EBITDA, as well as a 2% reduction in weighted average shares outstanding compared with the prior year quarter.
Adjusted Net Income, EBITDA, Adjusted EBITDA, FFO, and Normalized FFO, and, where appropriate, their corresponding per share amounts, are measures calculated and presented on the basis of methodologies other than in accordance with generally accepted accounting principles (GAAP). Please refer to the Supplemental Financial Information and the note following the financial statements herein for further discussion and reconciliations of these measures to net income, the most directly comparable GAAP measure.
Business Updates
Share Repurchases. On May 12, 2022, our Board of Directors approved a share repurchase program authorizing the Company to repurchase up to $150.0 million of our common stock. On August 2, 2022, our Board of Directors authorized an increase in our share repurchase program of up to an additional $75.0 million in shares of our common stock, or a total of up to $225.0 million. During the three months ended March 31, 2024, we repurchased 2.7 million shares of our common stock at an aggregate purchase price of $39.4 million, excluding fees, commissions and other costs related to the repurchases. Since the share repurchase program was authorized, through March 31, 2024, we have repurchased a total of 12.8 million shares at an aggregate price of $152.0 million, or $11.87 per share, excluding fees, commissions and other costs related to the repurchases.
As of March 31, 2024, we had $73.0 million remaining under the share repurchase program. Additional repurchases of common stock will be made in accordance with applicable securities laws and may be made at management’s discretion within parameters set by the Board of Directors from time to time in the open market, through privately negotiated transactions, or otherwise. The share repurchase program has no time limit and does not obligate us to purchase any particular amount of our common stock. The authorization for the share repurchase program may be terminated, suspended, increased or decreased by our Board of Directors in its discretion at any time.
Debt Refinancing. On March 12, 2024, we announced the completion of an underwritten registered public offering of $500 million aggregate principal amount of 8.250% senior unsecured notes due 2029 (the 2029 Notes). The net proceeds from the offering of the 2029 Notes, amounting to $490.3 million, together with borrowings under our revolving credit facility and cash on hand, were used to fund the tender offering for, and subsequent redemption of, the 8.250% senior unsecured notes due 2026 (the 2026 Notes), which had an outstanding principal balance of $593.1 million. Note holders with an aggregate principal amount of $494.3 million, or 83.3% of the aggregate principal amount of the 2026 Notes then-outstanding, tendered their notes by the expiration date on March 11, 2024, and on April 15, 2024, we redeemed the remaining $98.8 million principal balance outstanding.
California City Correctional Center. As previously disclosed, the lease with the California Department of Corrections and Rehabilitation at our 2,560-bed California City Correctional Center expired on March 31, 2024, and was not renewed. The facility was idled effective April 1, 2024. Rental revenue at this facility was $8.5 million and $31.1 million for the three months ended March 31, 2024 and twelve months ended December 31, 2023, respectively. Facility net operating income at the facility was $7.2 million and $25.5 million for the three months ended March 31, 2024 and the twelve months ended December 31, 2023, respectively. As a result, although we are marketing the facility to potential customers, we expect per share results to decline by approximately $0.06 per share during the second quarter of 2024 compared with the first quarter of 2024, and by approximately $0.15 to $0.16 per share for the year ended December 31, 2024 compared with the year ended December 31, 2023. The impact of this lease expiration has been, and continues to be, included in our 2024 financial guidance.
2024 Financial Guidance
Based on current business conditions, we are providing the following updated financial guidance for the full year 2024:
New Guidance Full Year 2024
Prior Guidance Full Year 2024
– Net income
$52.7 million to $63.7 million
$65.0 million to $80.0 million¹
– Adjusted net income
$74.0 million to $85.0 million
$65.0 million to $80.0 million
– Diluted EPS
$0.47 to $0.57
$0.58 to $0.72¹
– Adjusted Diluted EPS
$0.66 to $0.76
$0.58 to $0.72
– FFO per diluted share
$1.36 to $1.46
$1.46 to $1.61¹
– Normalized FFO per diluted share
$1.56 to $1.66
$1.46 to $1.61
– EBITDA
$281.1 million to $290.1 million
$300.3 million to $313.3 million¹
– Adjusted EBITDA
$312.0 million to $321.0 million
$300.3 million to $313.3 million
¹ Prior guidance did not include the aforementioned $27.2 million of expenses associated with debt repayments and refinancing transactions incurred during the first quarter of 2024.
During 2024, we expect to invest $70.0 million to $76.0 million in capital expenditures, consisting of $30.0 million to $31.0 million in maintenance capital expenditures on real estate assets, $32.0 million to $35.0 million for maintenance capital expenditures on other assets and information technology, and $8.0 million to $10.0 million for other capital investments.
Supplemental Financial Information and Investor Presentations
We have made available on our website supplemental financial information and other data for the first quarter of 2024. Interested parties may access this information through our website at http://ir.corecivic.com/ under “Financial Information” of the Investors section. We do not undertake any obligation and disclaim any duties to update any of the information disclosed in this report.
Management may meet with investors from time to time during the second quarter of 2024. Written materials used in the investor presentations will also be available on our website beginning on or about May 21, 2024. Interested parties may access this information through our website at http://ir.corecivic.com/ under “Events & Presentations” of the Investors section.
Conference Call, Webcast and Replay Information
We will host a webcast conference call at 10:00 a.m. central time (11:00 a.m. eastern time) on Thursday, May 9, 2024, which will be accessible through the Company’s website at www.corecivic.com under the “Events & Presentations” section of the “Investors” page. To participate via telephone and join the call live, please register in advance here https://register.vevent.com/register/BIa41ba53918294659afa34f33febf12cc. Upon registration, telephone participants will receive a confirmation email detailing how to join the conference call, including the dial-in number and a unique passcode.
About CoreCivic
CoreCivic is a diversified, government-solutions company with the scale and experience needed to solve tough government challenges in flexible, cost-effective ways. We provide a broad range of solutions to government partners that serve the public good through high-quality corrections and detention management, a network of residential and non-residential alternatives to incarceration to help address America’s recidivism crisis, and government real estate solutions. We are the nation’s largest owner of partnership correctional, detention and residential reentry facilities, and one of the largest prison operators in the United States. We have been a flexible and dependable partner for government for over 40 years. Our employees are driven by a deep sense of service, high standards of professionalism and a responsibility to help government better the public good. Learn more at www.corecivic.com.
Forward-Looking Statements
This press release contains statements as to our beliefs and expectations of the outcome of future events that are “forward-looking” statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, as amended. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the statements made. These include, but are not limited to, the risks and uncertainties associated with: (i) changes in government policy, legislation and regulations that affect utilization of the private sector for corrections, detention, and residential reentry services, in general, or our business, in particular, including, but not limited to, the continued utilization of our correctional and detention facilities by the federal government, including as a consequence of the United States Department of Justice not renewing contracts as a result of President Biden’s Executive Order on Reforming Our Incarceration System to Eliminate the Use of Privately Operated Criminal Detention Facilities, impacting utilization primarily by the United States Federal Bureau of Prisons and the United States Marshals Service, and the impact of any changes to immigration reform and sentencing laws (we do not, under longstanding policy, lobby for or against policies or legislation that would determine the basis for, or duration of, an individual’s incarceration or detention); (ii) our ability to obtain and maintain correctional, detention, and residential reentry facility management contracts because of reasons including, but not limited to, sufficient governmental appropriations, contract compliance, negative publicity and effects of inmate disturbances; (iii) changes in the privatization of the corrections and detention industry, the acceptance of our services, the timing of the opening of new facilities and the commencement of new management contracts (including the extent and pace at which new contracts are utilized), as well as our ability to utilize available beds; (iv) general economic and market conditions, including, but not limited to, the impact governmental budgets can have on our contract renewals and renegotiations, per diem rates, and occupancy; (v) fluctuations in our operating results because of, among other things, changes in occupancy levels; competition; contract renegotiations or terminations; inflation and other increases in costs of operations, including a continuing rise in labor costs; fluctuations in interest rates and risks of operations; (vi) government budget uncertainty, the impact of the debt ceiling and the potential for government shutdowns and changing budget priorities; (vii) our ability to successfully identify and consummate future development and acquisition opportunities and realize projected returns resulting therefrom; (viii) our ability to have met and maintained qualification for taxation as a real estate investment trust, or REIT, for the years we elected REIT status; and (ix) the availability of debt and equity financing on terms that are favorable to us, or at all. Other factors that could cause operating and financial results to differ are described in the filings we make from time to time with the Securities and Exchange Commission.
We take no responsibility for updating the information contained in this press release following the date hereof to reflect events or circumstances occurring after the date hereof or the occurrence of unanticipated events or for any changes or modifications made to this press release or the information contained herein by any third-parties, including, but not limited to, any wire or internet services, except as may be required by law.
Completed oversubscribed $50 million private placement
First participant dosed in clinical trial at University of Chicago Medicine assessing the use of tegoprubart to prevent islet cell transplant rejection in patients with type 1 diabetes
Reported updated data from ongoing Phase 1b trial evaluating tegoprubart for prevention of rejection in kidney transplantation
Tegoprubart used as part of immunosuppressive treatment following the first-ever kidney xenotransplant
IRVINE, Calif., May 09, 2024 (GLOBE NEWSWIRE) — Eledon Pharmaceuticals, Inc. (“Eledon”) (Nasdaq: ELDN) today reported its first quarter 2024 operating and financial results and reviewed recent business highlights.
“We are pleased with the significant progress made so far this year in the development of tegoprubart for use both in kidney transplantation and in the emerging fields of xenotransplantation and islet cell transplantation. This progress reinforces tegoprubart’s potential to become the first-line immunosuppressive treatment option of choice for a broad range of transplant procedures,” said David-Alexandre C. Gros, M.D., Chief Executive Officer of Eledon.
First Quarter 2024 and Recent Corporate Developments
First participant in an investigator-led clinical trial has received an islet cell transplant and is being treated with a novel immunosuppression regimen including tegoprubart, the company’s novel anti-CD40L antibody, which is in development for the prevention of pancreatic islet cell transplant rejection in patients with type 1 diabetes. The study is being conducted by the research team at the University of Chicago’s Pancreatic and Islet Transplant Program in collaboration with Eledon, the Juvenile Diabetes Research Foundation, and The Cure Alliance.
Announced the use of tegoprubart as part of the immunosuppressive treatment regimen used following the first-ever kidney xenotransplant procedure of a genetically modified kidney from a pig to a human.
Enrolled the 12th participant in March 2024 in the ongoing Phase 2 BESTOW trial assessing tegoprubart head-to-head with tacrolimus for the prevention of rejection in kidney transplantation.
Completed a private placement financing for total gross proceeds of $50.0 million, before deducting any offering related expenses, to a select group of institutional and accredited investors at a price per share of $2.37.
Anticipated 2024 Milestones
June 2024: Report updated interim clinical data from the ongoing Phase 1b trial and open-label extension study of tegoprubart in kidney transplantation at the American Transplant Congress in Philadelphia, PA.
End of 2024: Complete enrollment in the Phase 2 BESTOW trial of tegoprubart in kidney transplantation.
First Quarter 2024 Financial Results
The Company reported a net loss of $10.3 million, or $0.34 per share, for the three months ended March 31, 2024, compared to a net loss of $10.8 million, or $0.75 per share, for the same period in 2023.
Research and development expenses were $7.4 million for the three months ended March 31, 2024, compared to $8.1 million for the comparable period in 2023, a decrease of $0.7 million.
General and administrative expenses were $3.5 million for the three months ended March 31, 2024, compared to $3.0 million for the comparable period in 2023, an increase of $0.5 million.
Eledon ended the first quarter with approximately $42.9 million in cash, cash equivalents and short-term investments, which excludes the $50.0 million in gross proceeds received in the recently completed private placement.
About Eledon Pharmaceuticals and tegoprubart
Eledon Pharmaceuticals, Inc. is a clinical stage biotechnology company that is developing immune-modulating therapies for the management and treatment of life-threatening conditions. The Company’s lead investigational product is tegoprubart, an anti-CD40L antibody with high affinity for CD40 Ligand, a well-validated biological target within the costimulatory CD40/CD40L cellular pathway. The central role of CD40L signaling in both adaptive and innate immune cell activation and function positions it as an attractive target for non-lymphocyte depleting, immunomodulatory therapeutic intervention. The Company is building upon a deep historical knowledge of anti-CD40 Ligand biology to conduct preclinical and clinical studies in kidney allograft transplantation, xenotransplantation, and amyotrophic lateral sclerosis (ALS). Eledon is headquartered in Irvine, California. For more information, please visit the Company’s website at www.eledon.com.
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Forward-Looking Statements
This press release contains forward-looking statements that involve substantial risks and uncertainties. Any statements about the company’s future expectations, plans and prospects, including statements about planned clinical trials, the development of product candidates, expected timing for initiation of future clinical trials, expected timing for receipt of data from clinical trials, the company’s capital resources and ability to finance planned clinical trials, as well as other statements containing the words “believes,” “anticipates,” “plans,” “expects,” “estimates,” “intends,” “predicts,” “projects,” “targets,” “looks forward,” “could,” “may,” and similar expressions, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently uncertain and are subject to numerous risks and uncertainties, including: risks relating to the safety and efficacy of our drug candidates; risks relating to clinical development timelines, including interactions with regulators and clinical sides, as well as patient enrollment; risks relating to costs of clinical trials and the sufficiency of the company’s capital resources to fund planned clinical trials; and risks associated with the impact of the ongoing coronavirus pandemic. Actual results may differ materially from those indicated by such forward-looking statements as a result of various factors. These risks and uncertainties, as well as other risks and uncertainties that could cause the company’s actual results to differ significantly from the forward-looking statements contained herein, are discussed in our quarterly 10-Qs, annual 10-K, and other filings with the U.S. Securities and Exchange Commission, which can be found at www.sec.gov. Any forward-looking statements contained in this press release speak only as of the date hereof and not of any future date, and the company expressly disclaims any intent to update any forward-looking statements, whether as a result of new information, future events or otherwise.
Third Quarter of Fiscal Year 2024 – Consolidated Earnings Highlights
Revenue of $376.4 million
Net income of $8.6 million
Adjusted EBITDA* of $46.6 million
Raising Fiscal Year 2024 Guidance Ranges:
Revenue expected in a range of $1.25 billion to $1.3 billion vs prior range of $1.23 billion to $1.3 billion
Net loss expected in a range of $34 million to $21 million vs prior range of $45 million to $22 million
Adjusted EBITDA* expected in a range of $100 million to $110 million vs prior range of $90 million to $105 million
Third Quarter of Fiscal Year 2024 – Segment Highlights
Senior
Revenue of $204.3 million
Adjusted EBITDA* of $61.5 million
Approved Medicare Advantage policies of 185,716
Healthcare Services
Revenue of $124.2 million
Adjusted EBITDA* of $1.6 million
Over 75,000 SelectRx members
Life
Revenue of $40.7 million
Adjusted EBITDA* of $3.1 million
Auto & Home
Revenue of $9.1 million
Adjusted EBITDA* of $3.6 million
OVERLAND PARK, Kan.–(BUSINESS WIRE)– SelectQuote, Inc. (NYSE: SLQT) reported consolidated revenue for the third quarter of fiscal year 2024 of $376.4 million, compared to consolidated revenue for the third quarter of fiscal year 2023 of $299.4 million. Consolidated net income for the third quarter of fiscal year 2024 was $8.6 million, compared to consolidated net income for the third quarter of fiscal year 2023 of $9.3 million. Finally, consolidated Adjusted EBITDA* for the third quarter of fiscal year 2024 was $46.6 million, compared to consolidated Adjusted EBITDA* for the third quarter of fiscal year 2023 of $44.0 million.
Chief Executive Officer Tim Danker commented, “SelectQuote outperformed our own expectations for the 9th consecutive quarter, and the company has never been better positioned to drive shareholder value. We firmly believe SelectQuote can amplify the strong operating results achieved over the past two years since our foundational strategic redesign.”
“Our Senior business completed another highly successful Medicare Advantage busy season in the quarter, which produced stable and attractive economics across both policy growth, LTV expansion, and operating efficiency. The segment’s core tenured agents helped over 185,000 Americans find the right Medicare Advantage policy and did so with strong overall cost per policy and efficient close rates, which drove a Senior Adjusted EBITDA margin above 30% in one of our highest open enrollment period (OEP) quarters for revenue in company history. The success in our Senior business also enhanced the continued expansion of our Healthcare Services business, which saw SelectRx grow by over 12,000 members, significantly exceeding our original outlook. Overall, our holistic healthcare platform created new customers at a highly efficient revenue to customer acquisition cost of over 4x, which will drive significant Adjusted EBITDA contribution as Healthcare Services continues to scale.”
Mr. Danker concluded, “The teams at SelectQuote and our leadership are energized about the successes experienced year-to-date. We have conviction that 2024 will prove to be an inflection point in our company’s history, and SelectQuote is poised to leverage our unique healthcare platform to drive attractive returns for our shareholders in the quarters and years ahead.”
Segment Results
We currently report on four segments: 1) Senior, 2) Healthcare Services, 3) Life, and 4) Auto & Home. The performance measures of the segments include total revenue, Adjusted EBITDA,* and Adjusted EBITDA Margin.* Costs of revenue, cost of goods sold-pharmacy revenue, marketing and advertising, selling, general, and administrative, and technical development operating expenses that are directly attributable to a segment are reported within the applicable segment. Indirect costs of revenue, marketing and advertising, selling, general, and administrative, and technical development operating expenses are allocated to each segment based on varying metrics such as headcount. Adjusted EBITDA is calculated as total revenue for the applicable segment less direct and allocated costs of revenue, cost of goods sold, marketing and advertising, technical development, and selling, general, and administrative operating costs and expenses, excluding depreciation and amortization expense; gain or loss on disposal of property, equipment, and software; share-based compensation expense; and non-recurring expenses such as severance payments and transaction costs.
Senior
Financial Results
The following table provides the financial results for the Senior segment for the periods presented:
Three Months Ended March 31,
Nine Months Ended March 31,
(in thousands)
2024
2023
% Change
2024
2023
% Change
Revenue
$
204,259
$
185,200
10
%
$
541,705
$
486,541
11
%
Adjusted EBITDA*
61,494
59,166
4
%
138,871
138,933
—
%
Adjusted EBITDA Margin*
30
%
32
%
26
%
29
%
Operating Metrics
Submitted Policies
Submitted policies are counted when an individual completes an application with our licensed agent and provides authorization to the agent to submit the application to the insurance carrier partner. The applicant may have additional actions to take before the application will be reviewed by the insurance carrier.
The following table shows the number of submitted policies for the periods presented:
Three Months Ended March 31,
Nine Months Ended March 31,
2024
2023
% Change
2024
2023
% Change
Medicare Advantage
226,692
196,372
15
%
602,936
538,247
12
%
Medicare Supplement
650
675
(4
)%
2,334
2,905
(20
)%
Dental, Vision and Hearing
16,588
21,175
(22
)%
48,892
59,513
(18
)%
Prescription Drug Plan
665
416
60
%
2,696
2,082
29
%
Other
774
1,864
(58
)%
3,724
5,402
(31
)%
Total
245,369
220,502
11
%
660,582
608,149
9
%
*See “Non-GAAP Financial Measures” below.
Approved Policies
Approved policies represents the number of submitted policies that were approved by our insurance carrier partners for the identified product during the indicated period. Not all approved policies will go in force.
The following table shows the number of approved policies for the periods presented:
Three Months Ended March 31,
Nine Months Ended March 31,
2024
2023
% Change
2024
2023
% Change
Medicare Advantage
185,716
165,530
12
%
517,973
467,540
11
%
Medicare Supplement
445
557
(20
)%
1,578
2,184
(28
)%
Dental, Vision and Hearing
14,042
16,968
(17
)%
41,474
47,940
(13
)%
Prescription Drug Plan
1,114
521
114
%
2,684
1,794
50
%
Other
789
1,029
(23
)%
2,834
3,932
(28
)%
Total
202,106
184,605
9
%
566,543
523,390
8
%
Lifetime Value of Commissions per Approved Policy
Lifetime value of commissions per approved policy represents commissions estimated to be collected over the estimated life of an approved policy based on multiple factors, including but not limited to, contracted commission rates, carrier mix and expected policy persistency with applied constraints. The lifetime value of commissions per approved policy is equal to the sum of the commission revenue due upon the initial sale of a policy, and when applicable, an estimate of future renewal commissions.
The following table shows the lifetime value of commissions per approved policy for the periods presented:
Three Months Ended March 31,
Nine Months Ended March 31,
(dollars per policy):
2024
2023
% Change
2024
2023
% Change
Medicare Advantage
$
995
$
965
3
%
$
923
$
888
4
%
Medicare Supplement
1,271
871
46
%
1,108
994
11
%
Dental, Vision and Hearing
101
91
11
%
100
95
5
%
Prescription Drug Plan
237
194
22
%
237
211
12
%
Other
36
123
(71
)%
(3
)
100
(103
)%
Healthcare Services
Financial Results
The following table provides the financial results for the Healthcare Services segment for the periods presented:
Three Months Ended March 31,
Nine Months Ended March 31,
(in thousands)
2024
2023
% Change
2024
2023
% Change
Revenue
$
124,207
$
70,725
76
%
$
333,284
$
169,270
97
%
Adjusted EBITDA*
1,609
(3,366
)
148
%
6,911
(24,456
)
128
%
Adjusted EBITDA Margin*
1
%
(5
)%
2
%
(14
)%
*See “Non-GAAP Financial Measures” below.
Operating Metrics
Total Members
The total number of SelectRx members represents the amount of customers to which an order has been shipped, as this is the primary key driver of revenue for Healthcare Services.
The following table shows the total number of SelectRx members for the date presented:
March 31, 2024
March 31, 2023
Total SelectRx Members
75,074
44,993
Prescriptions Per Day
Prescriptions per day represents the total average prescriptions shipped per business day, as this is a primary key driver of revenue for Healthcare Services.
The following table shows the prescriptions shipped per day for the periods presented:
Three Months Ended March 31,
Nine Months Ended March 31,
2024
2023
2024
2023
Prescriptions Per Day
20,216
11,737
17,582
9,753
Combined Senior and Healthcare Services – Consumer Per Unit Economics
The opportunity to leverage our existing database and distribution model to improve access to healthcare services for our consumers has created a need for us to review our key metrics related to our per unit economics. As we think about the revenue and expenses for Healthcare Services, we note that they are derived from the marketing acquisition costs associated with the sale of an MA or MS policy, some of which costs are allocated directly to Healthcare Services, and therefore determined that our per unit economics measure should include components from both Senior and Healthcare Services. See details of revenue and expense items included in the calculation below.
Combined Senior and Healthcare Services consumer per unit economics represents total MA and MS commissions; other product commissions; other revenues, including revenues from Healthcare Services; and operating expenses associated with Senior and Healthcare Services, each shown per number of approved MA and MS policies over a given time period. Management assesses the business on a per-unit basis to help ensure that the revenue opportunity associated with a successful policy sale is attractive relative to the marketing acquisition cost. Because not all acquired leads result in a successful policy sale, all per-policy metrics are based on approved policies, which is the measure that triggers revenue recognition.
The MA and MS commission per MA/MS policy represents the LTV for policies sold in the period. Other commission per MA/MS policy represents the LTV for other products sold in the period, including DVH prescription drug plan, and other products, which management views as additional commission revenue on our agents’ core function of MA/MS policy sales. Pharmacy revenue per MA/MS policy represents revenue from SelectRx, and other revenue per MA/MS policy represents revenue from Population Health, production bonuses, marketing development funds, lead generation revenue, and adjustments from the Company’s reassessment of its cohorts’ transaction prices. Total operating expenses per MA/MS policy represents all of the operating expenses within Senior and Healthcare Services. The revenue to customer acquisition cost (“CAC”) multiple represents total revenue as a multiple of total marketing acquisition costs, which represents the direct costs of acquiring leads. These costs are included in marketing and advertising expense within the total operating expenses per MA/MS policy.
The following table shows combined Senior and Healthcare Services consumer per unit economics for the periods presented. Based on the seasonality of Senior and the fluctuations between quarters, we believe that the most relevant view of per unit economics is on a rolling 12-month basis. All per MA/MS policy metrics below are based on the sum of approved MA/MS policies, as both products have similar commission profiles.
Twelve Months Ended March 31,
(dollars per approved policy):
2024
2023
Medicare Advantage and Medicare Supplement approved policies
630,013
586,238
Medicare Advantage and Medicare Supplement commission per MA/MS policy
$
907
$
886
Other commission per MA/MS policy
10
15
Pharmacy revenue per MA/MS policy
641
320
Other revenue per MA/MS policy
126
66
Total revenue per MA/MS policy
1,684
1,287
Total operating expenses per MA/MS policy
(1,425
)
(1,167
)
Adjusted EBITDA per MA/MS policy (1)
$
259
$
120
Adjusted EBITDA Margin per MA/MS policy (1)
15
%
9
%
Revenue/CAC multiple
4.2
X
3.5
X
(1) These financial measures are not calculated in accordance with GAAP. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures” in the Company’s Quarterly Report on Form 10-Q for information regarding our use of these non-GAAP financial measures and a reconciliation of such measures to their nearest comparable financial measures calculated and presented in accordance with GAAP.
Total revenue per MA/MS policy increased 31% for the twelve months ended March 31, 2024, compared to the twelve months ended March 31, 2023, primarily due to the increase in pharmacy revenue. Total operating expenses per MA/MS policy increased 22% for the twelve months ended March 31, 2024, compared to the twelve months ended March 31, 2023, primarily driven by increase in cost of goods sold-pharmacy revenue for SelectRx due to the growth of the business.
Life
Financial Results
The following table provides the financial results for the Life segment for the periods presented:
Three Months Ended March 31,
Nine Months Ended March 31,
(in thousands)
2024
2023
% Change
2024
2023
% Change
Revenue
$
40,686
$
36,950
10
%
$
115,855
$
107,780
7
%
Adjusted EBITDA*
3,138
5,303
(41
)%
12,945
16,371
(21
)%
Adjusted EBITDA Margin*
8
%
14
%
11
%
15
%
Operating Metrics
Life premium represents the total premium value for all policies that were approved by the relevant insurance carrier partner and for which the policy document was sent to the policyholder and payment information was received by the relevant insurance carrier partner during the indicated period. Because our commissions are earned based on a percentage of total premium, total premium volume for a given period is the key driver of revenue for our Life segment.
*See “Non-GAAP Financial Measures” below.
The following table shows term and final expense premiums for the periods presented:
Three Months Ended March 31,
Nine Months Ended March 31,
(in thousands)
2024
2023
% Change
2024
2023
% Change
Term Premiums
$
16,788
$
17,512
(4
)%
$
52,376
$
48,433
8
%
Final Expense Premiums
23,724
19,308
23
%
62,811
58,766
7
%
Total
$
40,512
$
36,820
10
%
115,187
107,199
7
%
Auto & Home
Financial Results
The following table provides the financial results for the Auto & Home segment for the periods presented:
Three Months Ended March 31,
Nine Months Ended March 31,
(in thousands)
2024
2023
% Change
2024
2023
% Change
Revenue
$
9,134
$
8,238
11
%
$
28,649
$
23,128
24
%
Adjusted EBITDA*
3,609
2,591
39
%
11,654
7,315
59
%
Adjusted EBITDA Margin*
40
%
31
%
41
%
32
%
Operating Metrics
Auto & Home premium represents the total premium value of all new policies that were approved by our insurance carrier partners during the indicated period. Because our commissions are earned based on a percentage of total premium, total premium volume for a given period is the key driver of revenue for our Auto & Home segment.
The following table shows premiums for the periods presented:
Three Months Ended March 31,
Nine Months Ended March 31,
(in thousands):
2024
2023
% Change
2024
2023
% Change
Premiums
$
14,180
$
12,828
11
%
$
42,746
$
36,456
17
%
Amendment to Credit Agreement
On May 8, 2024, the Company and its lenders agreed to amend the Company’s credit agreement to extend the maturity date with respect to $683.8 million of extended term loans from February 15, 2025 to May 15, 2025. The amendment also provides for a minimum asset coverage ratio and minimum liquidity requirements for the extension period. Additional information regarding the amendment will be included in the Company’s Quarterly Report on Form 10-Q for the period ended March 31, 2024.
Earnings Conference Call
SelectQuote, Inc. will host a conference call with the investment community today, Thursday, May 9, 2024, beginning at 9:00 a.m. ET. To register for this conference call, please use this link: https://www.netroadshow.com/events/login?show=2a79382d&confId=63927. After registering, a confirmation will be sent via email, including dial-in details and unique conference call codes for entry. Registration is open through the live call, but to ensure you are connected for the full call we suggest registering at least 10 minutes before the start of the call. The event will also be webcasted live via our investor relations website https://ir.selectquote.com/investor-home/default.aspx.
*See “Non-GAAP Financial Measures” below.
Non-GAAP Financial Measures
This release includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. To supplement our financial statements presented in accordance with GAAP and to provide investors with additional information regarding our GAAP financial results, we have presented in this release Adjusted EBITDA and Adjusted EBITDA Margin, which are non-GAAP financial measures. These non-GAAP financial measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similarly titled measures presented by other companies. We define Adjusted EBITDA as income (loss) before interest expense, income tax expense (benefit), depreciation and amortization, and certain add-backs for non-cash or non-recurring expenses, including restructuring and share-based compensation expenses. The most directly comparable GAAP measure is net income (loss). We define Adjusted EBITDA Margin as Adjusted EBITDA divided by revenue. The most directly comparable GAAP measure is net income margin. We monitor and have presented in this release Adjusted EBITDA and Adjusted EBITDA Margin because they are key measures used by our management and Board of Directors to understand and evaluate our operating performance, to establish budgets and to develop operational goals for managing our business. In particular, we believe that excluding the impact of these expenses in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core operating performance.
We believe that these non-GAAP financial measures help identify underlying trends in our business that could otherwise be masked by the effect of the expenses that we exclude in the calculations of these non-GAAP financial measures. Accordingly, we believe these financial measures provide useful information to investors and others in understanding and evaluating our operating results, enhancing the overall understanding of our past performance and future prospects. Reconciliations of the differences between the non-GAAP financial measures included herein and their most directly comparable GAAP financial measures are set forth below beginning on page 12.
Forward Looking Statements
This release contains forward-looking statements. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “would” and “outlook,” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates, and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.
There are or will be important factors that could cause our actual results to differ materially from those indicated in these forward-looking statements, including, but not limited to, the following: the impacts of the COVID-19 pandemic and any other public health events, our reliance on a limited number of insurance carrier partners and any potential termination of those relationships or failure to develop new relationships; existing and future laws and regulations affecting the health insurance market; changes in health insurance products offered by our insurance carrier partners and the health insurance market generally; insurance carriers offering products and services directly to consumers; changes to commissions paid by insurance carriers and underwriting practices; competition with brokers, including exclusively online brokers and carriers who opt to sell policies directly to consumers; competition from government-run health insurance exchanges; developments in the U.S. health insurance system; our dependence on revenue from carriers in our senior segment and downturns in the senior health as well as life, automotive and home insurance industries; our ability to develop new offerings and penetrate new vertical markets; risks from third-party products; failure to enroll individuals during the Medicare annual enrollment period; our ability to attract, integrate and retain qualified personnel; our dependence on lead providers and ability to compete for leads; failure to obtain and/or convert sales leads to actual sales of insurance policies; access to data from consumers and insurance carriers; accuracy of information provided from and to consumers during the insurance shopping process; cost-effective advertisement through internet search engines; ability to contact consumers and market products by telephone; global economic conditions, including inflation; disruption to operations as a result of future acquisitions; significant estimates and assumptions in the preparation of our financial statements; impairment of goodwill; potential litigation and other legal proceedings or inquiries; our existing and future indebtedness; our ability to maintain compliance with our debt covenants and meet our scheduled repayment obligations under our debt arrangements; our ability to access additional capital on acceptable terms; failure to protect our intellectual property and our brand; fluctuations in our financial results caused by seasonality; accuracy and timeliness of commissions reports from insurance carriers; timing of insurance carriers’ approval and payment practices; factors that impact our estimate of the constrained lifetime value of commissions per policyholder; changes in accounting rules, tax legislation and other legislation; disruptions or failures of our technological infrastructure and platform; failure to maintain relationships with third-party service providers; cybersecurity breaches or other attacks involving our systems or those of our insurance carrier partners or third-party service providers; our ability to protect consumer information and other data; failure to market and sell Medicare plans effectively or in compliance with laws; and other factors related to our pharmacy business, including manufacturing or supply chain disruptions, access to and demand for prescription drugs, and regulatory changes or other industry developments that may affect our pharmacy operations. For a further discussion of these and other risk factors that could impact our future results and performance, see the section entitled “Risk Factors” in the most recent Annual Report on Form 10-K and subsequent periodic reports filed by us with the Securities and Exchange Commission. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and, except as otherwise required by law, we do not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.
About SelectQuote:
Founded in 1985, SelectQuote (NYSE: SLQT) provides solutions that help consumers protect their most valuable assets: their families, health, and property. The company pioneered the model of providing unbiased comparisons from multiple, highly-rated insurance companies allowing consumers to choose the policy and terms that best meet their unique needs. Two foundational pillars underpin SelectQuote’s success: a strong force of highly-trained and skilled agents who provide a consultative needs analysis for every consumer, and proprietary technology that sources and routes high-quality leads.
With an ecosystem offering high touchpoints for consumers across insurance, medicare, pharmacy, and value-based care, the company now has four core business lines: SelectQuote Senior, SelectQuote Healthcare Services, SelectQuote Life, and SelectQuote Auto and Home. SelectQuote Senior serves the needs of a demographic that sees around 10,000 people turn 65 each day with a range of Medicare Advantage and Medicare Supplement plans. SelectQuote Healthcare Services is comprised of the SelectRx Pharmacy, a Patient-Centered Pharmacy Home™ (PCPH) accredited pharmacy, and Population Health, which proactively connects consumers with a wide breadth of healthcare services supporting their needs..
SELECTQUOTE, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(Unaudited)(In thousands)
March 31, 2024
June 30, 2023
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
$
37,808
$
83,156
Accounts receivable, net of allowances of $6.5 million and $2.7 million, respectively
253,083
154,565
Commissions receivable-current
69,165
111,148
Other current assets
24,115
14,355
Total current assets
384,171
363,224
COMMISSIONS RECEIVABLE—Net
763,958
729,350
PROPERTY AND EQUIPMENT—Net
22,536
27,452
SOFTWARE—Net
13,952
14,740
OPERATING LEASE RIGHT-OF-USE ASSETS
19,341
23,563
INTANGIBLE ASSETS—Net
7,926
10,200
GOODWILL
29,136
29,136
OTHER ASSETS
4,119
21,586
TOTAL ASSETS
$
1,245,139
$
1,219,251
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable
$
61,168
$
27,577
Accrued expenses
21,058
16,993
Accrued compensation and benefits
57,483
49,966
Operating lease liabilities—current
4,663
5,175
Current portion of long-term debt
37,717
33,883
Contract liabilities
3,655
1,691
Other current liabilities
4,227
1,972
Total current liabilities
189,971
137,257
LONG-TERM DEBT, NET—less current portion
648,331
664,625
DEFERRED INCOME TAXES
35,057
39,581
OPERATING LEASE LIABILITIES
22,326
27,892
OTHER LIABILITIES
2,649
2,926
Total liabilities
898,334
872,281
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY:
Common stock, $0.01 par value
1,692
1,669
Additional paid-in capital
577,389
567,266
Accumulated deficit
(238,752
)
(235,644
)
Accumulated other comprehensive income
6,476
13,679
Total shareholders’ equity
346,805
346,970
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
$
1,245,139
$
1,219,251
SELECTQUOTE, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS(Unaudited)(In thousands)
Three Months Ended March 31,
Nine Months Ended March 31,
2024
2023
2024
2023
REVENUE:
Commission
$
230,763
$
197,258
$
611,744
533,627
Pharmacy
120,282
66,948
323,865
159,641
Other
25,355
35,192
78,958
87,802
Total revenue
376,400
299,398
1,014,567
781,070
OPERATING COSTS AND EXPENSES:
Cost of revenue
84,315
79,186
254,250
235,827
Cost of goods sold—pharmacy revenue
106,172
62,302
284,360
154,753
Marketing and advertising
109,276
90,205
288,676
237,724
Selling, general, and administrative
34,971
27,544
97,049
86,662
Technical development
8,604
6,434
24,291
18,860
Total operating costs and expenses
343,338
265,671
948,626
733,826
INCOME FROM OPERATIONS
33,062
33,727
65,941
47,244
INTEREST EXPENSE, NET
(24,330
)
(21,105
)
(70,141
)
(58,885
)
OTHER INCOME (EXPENSE,) NET
(12
)
(206
)
(51
)
(118
)
INCOME (LOSS) BEFORE INCOME TAX EXPENSE (BENEFIT)
8,720
12,416
(4,251
)
(11,759
)
INCOME TAX EXPENSE (BENEFIT)
169
3,152
(1,143
)
(1,053
)
NET INCOME (LOSS)
$
8,551
$
9,264
$
(3,108
)
(10,706
)
NET INCOME (LOSS) PER SHARE:
Basic
$
0.05
$
0.06
$
(0.02
)
$
(0.06
)
Diluted
$
0.05
$
0.06
$
(0.02
)
$
(0.06
)
WEIGHTED-AVERAGE COMMON STOCK OUTSTANDING USED IN PER SHARE AMOUNTS:
Basic
169,070
166,543
168,291
165,951
Diluted
170,956
167,905
168,291
165,951
OTHER COMPREHENSIVE INCOME (LOSS) NET OF TAX:
Gain (loss) on cash flow hedge
(1,771
)
(2,661
)
(7,203
)
1,358
OTHER COMPREHENSIVE INCOME (LOSS)
(1,771
)
(2,661
)
(7,203
)
1,358
COMPREHENSIVE INCOME (LOSS)
$
6,780
$
6,603
$
(10,311
)
$
(9,348
)
SELECTQUOTE, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)(In thousands)
Nine Months Ended March 31,
2024
2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss
$
(3,108
)
$
(10,706
)
Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities:
Depreciation and amortization
18,591
21,087
Loss on disposal of property, equipment, and software
13
390
Share-based compensation expense
10,512
8,525
Deferred income taxes
(2,151
)
(1,416
)
Amortization of debt issuance costs and debt discount
4,863
6,250
Write-off of debt issuance costs
293
710
Accrued interest payable in kind
14,323
8,450
Non-cash lease expense
1,945
3,115
Changes in operating assets and liabilities:
Accounts receivable, net
(98,519
)
(62,738
)
Commissions receivable
7,375
17,092
Other assets
(2,620
)
3,166
Accounts payable and accrued expenses
36,073
6,440
Operating lease liabilities
(3,802
)
(4,331
)
Other liabilities
11,453
(8,869
)
Net cash used in operating activities
(4,759
)
(12,835
)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment
(3,114
)
(1,056
)
Proceeds from sales of property and equipment
253
—
Purchases of software and capitalized software development costs
(6,065
)
(5,804
)
Net cash used in investing activities
(8,926
)
(6,860
)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on Term Loans
(30,412
)
(17,833
)
Payments on other debt
(112
)
(123
)
Proceeds from common stock options exercised and employee stock purchase plan
8
1,187
Payments of tax withholdings related to net share settlement of equity awards
(374
)
(40
)
Payments of debt issuance costs
(773
)
(10,110
)
Payment of acquisition holdback
—
(2,335
)
Net cash used in financing activities
(31,663
)
(29,254
)
NET DECREASE IN CASH AND CASH EQUIVALENTS
(45,348
)
(48,949
)
CASH AND CASH EQUIVALENTS—Beginning of period
83,156
140,997
CASH AND CASH EQUIVALENTS—End of period
$
37,808
$
92,048
SELECTQUOTE, INC. AND SUBSIDIARIESNet Income (Loss) to Adjusted EBITDA Reconciliation(Unaudited)
Three Months Ended March 31, 2024
(in thousands)
Senior
Healthcare Services
Life
Auto & Home
Corp & Elims
Consolidated
Revenue
$
204,259
$
124,207
$
40,686
$
9,134
$
(1,886
)
$
376,400
Operating expenses
(142,765
)
(122,598
)
(37,548
)
(5,524
)
(21,355
)
(329,790
)
Other income (expense), net
—
—
—
(1
)
(11
)
(12
)
Adjusted EBITDA
$
61,494
$
1,609
$
3,138
$
3,609
$
(23,252
)
$
46,598
Share-based compensation expense
(3,515
)
Transaction costs
(3,325
)
Depreciation and amortization
(6,704
)
Loss on disposal of property, equipment, and software
(4
)
Interest expense, net
(24,330
)
Income tax expense
(169
)
Net income
$
8,551
Three Months Ended March 31, 2023
(in thousands)
Senior
Healthcare Services
Life
Auto & Home
Corp & Elims
Consolidated
Revenue
$
185,200
$
70,725
$
36,950
$
8,238
$
(1,715
)
$
299,398
Operating expenses
(126,034
)
(74,091
)
(31,446
)
(5,648
)
(17,947
)
(255,166
)
Other income (expense), net
—
—
(201
)
1
(6
)
(206
)
Adjusted EBITDA
$
59,166
$
(3,366
)
$
5,303
$
2,591
$
(19,668
)
$
44,026
Share-based compensation expense
(2,959
)
Transaction costs
(433
)
Depreciation and amortization
(7,098
)
Loss on disposal of property, equipment, and software
(15
)
Interest expense, net
(21,105
)
Income tax expense
(3,152
)
Net income
$
9,264
Nine Months Ended March 31, 2024
(in thousands)
Senior
Healthcare Services
Life
Auto & Home
Corp & Elims
Consolidated
Revenue
$
541,705
$
333,284
$
115,855
$
28,649
$
(4,926
)
$
1,014,567
Operating expenses
(402,834
)
(326,373
)
(102,910
)
(16,994
)
(62,770
)
(911,881
)
Other income (expense), net
—
—
—
(1
)
(50
)
(51
)
Adjusted EBITDA
$
138,871
$
6,911
$
12,945
$
11,654
$
(67,746
)
$
102,635
Share-based compensation expense
(10,512
)
Transaction costs
(7,629
)
Depreciation and amortization
(18,591
)
Loss on disposal of property, equipment, and software
(13
)
Interest expense, net
(70,141
)
Income tax benefit
1,143
Net loss
$
(3,108
)
Nine Months Ended March 31, 2023
(in thousands)
Senior
Healthcare Services
Life
Auto & Home
Corp & Elims
Consolidated
Revenue
$
486,541
$
169,270
$
107,780
$
23,128
$
(5,649
)
$
781,070
Operating expenses
(347,608
)
(193,726
)
(91,409
)
(15,812
)
(52,270
)
(700,825
)
Other income (expense), net
—
—
—
(1
)
(117
)
(118
)
Adjusted EBITDA
$
138,933
$
(24,456
)
$
16,371
$
7,315
$
(58,036
)
$
80,127
Share-based compensation expense
(8,525
)
Transaction costs
(3,003
)
Depreciation and amortization
(21,087
)
Loss on disposal of property, equipment, and software
(386
)
Interest expense, net
(58,885
)
Income tax benefit
1,053
Net loss
$
(10,706
)
SELECTQUOTE, INC. AND SUBSIDIARIESNet Loss to Adjusted EBITDA Reconciliation(Unaudited)
Guidance net loss to Adjusted EBITDA reconciliation, year ending June 30, 2024:
IRVINE, Calif., May 09, 2024 (GLOBE NEWSWIRE) — Eledon Pharmaceuticals, Inc. (“Eledon”) (Nasdaq: ELDN) today announced that the Company will participate in the American Transplant Congress (ATC) taking place in Philadelphia, PA from June 1-5, 2024. The Company will present a poster that features updated data from Eledon’s ongoing open-label Phase 1b trial and open-label extension study evaluating tegoprubart for the prevention of rejection in patients undergoing kidney transplantation.
Details on the poster presentation are below:
Title: Biomarkers of Inflammation and eGFR in an Ongoing Phase 1B Study of an Anti-CD40L Antibody Tegoprubart, for the Prevention of Rejection in Kidney Transplant Presenter: Steve Perrin, Ph.D., President and Chief Scientific Officer, Eledon Pharmaceuticals Poster Number: 6647
Session Date and Time: Monday, June 3, 9:15-10:00 A.M. ET & 2:30-3:15 P.M. ET
The Company will also sponsor a satellite symposium at ATC titled: Blazing a path towards “Total Success” in Solid Organ Transplantation, to be held on Sunday, June 2, at 12:15pm ET. Faculty include, Flavio Vincenti, M.D., University of California San Francisco, Diane Cibrik, M.D., University of Kansas Health System, Allan Kirk, M.D., Duke University School of Medicine, Jay Fishman, M.D., Massachusetts General Hospital, Klemens Budde, M.D., Charité Universitätsmedizin Berlin and Roslyn Mannon, M.D., University of Nebraska Medical Center.
About Eledon Pharmaceuticals and tegoprubart
Eledon Pharmaceuticals, Inc. is a clinical stage biotechnology company that is developing immune-modulating therapies for the management and treatment of life-threatening conditions. The Company’s lead investigational product is tegoprubart, an anti-CD40L antibody with high affinity for CD40 Ligand, a well-validated biological target within the costimulatory CD40/CD40L cellular pathway. The central role of CD40L signaling in both adaptive and innate immune cell activation and function positions it as an attractive target for non-lymphocyte depleting, immunomodulatory therapeutic intervention. The Company is building upon a deep historical knowledge of anti-CD40 Ligand biology to conduct preclinical and clinical studies in kidney allograft transplantation, xenotransplantation, and amyotrophic lateral sclerosis (ALS). Eledon is headquartered in Irvine, California. For more information, please visit the Company’s website at www.eledon.com.
Follow Eledon Pharmaceuticals on social media: LinkedIn; Twitter
CHICAGO, May 09, 2024 (GLOBE NEWSWIRE) — GoHealth, Inc. (NASDAQ: GOCO) (“GoHealth” or the “Company”), a leading health insurance marketplace and Medicare-focused digital health company, today announced financial results for the three months ended March 31, 2024.
First Quarter Highlights
First quarter 2024 net revenues of $185.6 million, a slight increase compared to $183.2 million in the prior year period.
First quarter 2024 Submissions of 216,148, a 2,503 increase compared to 213,645 Submissions in the prior year period.
First quarter 2024 net loss of $21.3 million, an improvement of $1.2 million compared to $22.5 million in the prior year period.
First quarter 2024 Adjusted EBITDA(1) of $26.9 million, a decrease of $1.9 million compared to $28.8 million in the prior year period.
First quarter 2024 trailing twelve months (“TTM”) cash flow from operations was $101.2 million, compared to TTM cash flow from operations of $26.9 million in the prior year period.
Regulatory Updates
We are gaining insight into the Centers for Medicare and Medicaid Services (“CMS”) Final 2025 Marketing Rule and are confident that the CMS guidelines align with our Encompass model and our strategic plans.
Based on health plans’ reactions to the CMS Final 2025 Rate Notice we expect greater demand for the GoHealth personalized Encompass shopping and enrollment experience this fall.
“Our first quarter results exceeded our expectations and highlight our team’s ability to be innovative and resilient amongst market conditions. The proactive work we have done to drive consumer centricity has been instrumental in our ability to navigate the ever-evolving regulatory landscape. Our model is aligned with CMS’s intentions to protect consumers, and the work we have done has prepared us well for the current regulations and those likely to come,” said Vijay Kotte, CEO of GoHealth. “Looking ahead, we remain committed to leveraging our insights and technology to further improve the healthcare journey for consumers, ensuring they have the support they need to make informed decisions.”
“While we realize that rewarding agents for doing the right thing may not maximize revenue in the short term, we stand by our belief that PlanFit is an investment in the consumer that will pay off long-term,” said Jason Schulz, CFO of GoHealth. “This alignment of improved financial outcomes with our consumer-first philosophy supports our strategic direction. We remain committed to leveraging technology for better healthcare decisions, as we are poised to drive both sustained profitability and positive consumer impact in the years to come.
(1) Adjusted EBITDA is a non-GAAP measure. For a definition of Adjusted EBITDA and a reconciliation to the most comparable GAAP measure, please see below.
Conference Call Details
The Company will host a conference call today, Thursday, May 9, 2024 at 8:00 a.m. (ET) to discuss its financial results. Participants can pre-register for the conference call at the following link: https://register.vevent.com/register/BI3893cf432a644987bbaaed690971a174. A live audio webcast of the conference call will be available via GoHealth’s Investor Relations website, https://investors.gohealth.com/. A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call.
About GoHealth, Inc.
GoHealth is a leading health insurance marketplace and Medicare-focused digital health company whose purpose is to compassionately ensure consumers’ peace of mind when making healthcare decisions so they can focus on living life. For many of these consumers, enrolling in a health insurance plan is confusing and difficult, and seemingly small differences between health plans may lead to significant out-of-pocket costs or lack of access to critical providers and medicines. GoHealth’s proprietary technology platform leverages modern machine-learning algorithms, powered by over two decades of insurance purchasing behavior, to reimagine the process of matching a health plan to a consumer’s specific needs. Its unbiased, technology-driven marketplace coupled with highly skilled licensed agents has facilitated the enrollment of millions of consumers in Medicare plans since GoHealth’s inception. For more information, visit https://www.gohealth.com.
Investor Relations: John Shave JShave@gohealth.com
Media Relations: Pressinquiries@gohealth.com
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements are made in reliance upon the safe harbor provision of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this press release may be forward-looking statements. Statements regarding our future results of operations and financial position, business strategy and plans and objectives of management for future operations, including, among others, statements regarding our expected growth, future capital expenditures and debt service obligations, are forward-looking statements.
In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “aims,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” “likely,” “future” or “continue” or the negative of these terms or other similar expressions. The forward-looking statements in this press release are only predictions, projections and other statements about future events that are based on current expectations and assumptions. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.
These forward-looking statements speak only as of the date of this press release and are subject to a number of important factors that could cause actual results to differ materially from those in the forward-looking statements, including the factors described in the sections titled “Summary Risk Factors,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (“2023 Annual Report on Form 10-K”) and in our other filings with the Securities and Exchange Commission. The factors described in our 2023 Annual Report on Form 10-K should not be construed as exhaustive and should be read together with the other cautionary statements included in this press release, as well as the cautionary statements and other risk factors set forth in the forthcoming Quarterly Report on Form 10-Q for the first quarter ended March 31, 2024 and our other filings with the Securities and Exchange Commission.
You should read this press release and the documents that we reference in this press release completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.
PDS Biotech is a clinical-stage immunotherapy company developing a growing pipeline of molecularly targeted cancer and infectious disease immunotherapies based on the Company’s proprietary Versamune® and Infectimune™ T-cell activating technology platforms. Our Versamune®-based products have demonstrated the potential to overcome the limitations of current immunotherapy by inducing in vivo, large quantities of high-quality, highly potent polyfunctional tumor specific CD4+ helper and CD8+ killer T-cells. PDS Biotech has developed multiple therapies, based on combinations of Versamune® and disease-specific antigens, designed to train the immune system to better recognize diseased cells and effectively attack and destroy them. The Company’s pipeline products address various cancers including HPV16-associated cancers (anal, cervical, head and neck, penile, vaginal, vulvar) and breast, colon, lung, prostate and ovarian cancers.
Robert LeBoyer, Senior Vice President, Equity Research Analyst, Biotechnology, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
New Trial Design Will Test Two Drugs Against Standard Of Care. PDS Biotech held a KOL event featuring two prominent oncologists to discuss head and neck cancer and its clinical program data. The presentations included a review of current treatments and its two Phase 2 studies. The new Phase 3 study design was announced, now planned with three arms to test Versamune HPV with Keytruda, Versamune HPV and PDS01ADC with Keytruda, and Keytruda alone.
Phase 2 Trials Greatly Improved Patient Outcomes. The Phase 2 VERSATILE-002 trial testing Versamune HPV with Keytruda had strong improvements over current treatments in several clinical endpoints. During 2023, PDS discussed the path to approval for Versamune with the FDA. This led to design of the Phase 3 VERSATILE-003 trial testing the two-drug combination, similar to VERSATILE-002.
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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Another Approval. The Company announced receipt of the California Department of Food Agriculture registration approval for its TerraSante product. MustGrow also received organic certification from California’s Organic Input Material (OIM) Program, specific certification for California. The certification is a requirement for organic products to be sold in California and goes beyond MustGrow’s existing Organic OMRI Listed certifications. California now joins Washington and Oregon as states to authorize product sales of TerraSante.
OIM Program. According to the California Department of Food Agriculture, the OIM program registers materials used for fertilization of organic crops and food production. The material is either bulk or packaged and excludes pesticides. The program is mandated by the Legislature with support from the industry.
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CoreCivic is a diversified, government-solutions company with the scale and experience needed to solve tough government challenges in flexible, cost-effective ways. We provide a broad range of solutions to government partners that serve the public good through high-quality corrections and detention management, a network of residential and non-residential alternatives to incarceration to help address America’s recidivism crisis, and government real estate solutions. We are the nation’s largest owner of partnership correctional, detention and residential reentry facilities, and believe we are the largest private owner of real estate used by government agencies in the United States. We have been a flexible and dependable partner for government for nearly 40 years. Our employees are driven by a deep sense of service, high standards of professionalism and a responsibility to help government better the public good. Learn more at www.corecivic.com.
Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Results. Total revenue was $500.7 million for the quarter compared to $458.0 million in the prior year. This exceeded our expectations of $478 million. All of CoreCivic’s segments experienced growth over the prior year due to higher populations at the federal, state, and local populations. Another driver was revenue from ICE increasing from the prior year, as last year had Title 42 still enacted. Net income was $9.5 million, or $0.08/sh, from $12.4 million, or $0.11, last year. We estimated net income of $21.7 million or $0.19 per diluted share. Adjusted EPS was $0.25 for 1Q24, excluding one-time costs associated with the debt refinancing.
Debt Refinancing Completed and Share Repurchases. CoreCivic completed its registered public debt offering of $500 million on March 12, 2024. The offering, in conjunction with the Company’s revolving credit facility, paid off CoreCivic’s senior unsecured notes due 2026. The Company repurchased 2.7 million shares of its common stock during the quarter at an aggregate purchase price of $39.4 million, or approximately $14.59 per share.
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Great Lakes Dredge & Dock Corporation is the largest provider of dredging services in the United States. In addition, Great Lakes is fully engaged in expanding its core business into the rapidly developing offshore wind energy industry. The Company has a long history of performing significant international projects. The Company employs experienced civil, ocean and mechanical engineering staff in its estimating, production and project management functions. In its over 131-year history, the Company has never failed to complete a marine project. Great Lakes owns and operates the largest and most diverse fleet in the U.S. dredging industry, comprised of approximately 200 specialized vessels. Great Lakes has a disciplined training program for engineers that ensures experienced-based performance as they advance through Company operations. The Company’s Incident-and Injury-Free® (IIF®) safety management program is integrated into all aspects of the Company’s culture. The Company’s commitment to the IIF® culture promotes a work environment where employee safety is paramount.
Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
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Strong Performance. Limited drydockings during the quarter and record backlog led the charge in a strong first quarter. The Galveston Island, the Company’s new hopper dredge, also started operations during the quarter, contributing to the performance. The record backlog, consisting mostly of capital projects which carry higher margin, provides Great Lakes with revenue visibility throughout the fiscal year and improved margins, in our view.
Improved Environment. With the passage of the budget, the overall dredging environment has improved, in our view. We expect to see an uptick in project awards in the second and third quarters, with a couple of major capital projects to be included. Great Lakes is well positioned to win its fair share of the awards.
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Office Depot, Inc., together with its subsidiaries, supplies a range of office products and services. It offers merchandise, such as general office supplies, computer supplies, business machines and related supplies, and office furniture through its chain of office supply stores under the Office Depot, Foray, Ativa, Break Escapes, Worklife, and Christopher Lowell brand names. The company also provides graphic design, printing, reproduction, mailing, shipping, and other services through design, print, and ship centers. It has operations throughout North America, Europe, Asia, and Central America. The company also sells its products and services through direct mail catalogs, contract sales force, Internet sites, and retail stores, through a mix of company-owned operations, joint ventures, licensing and franchise agreements, alliances, and other arrangements. As of December 31, 2008, Office Depot operated 1,267 North American retail division office supply stores and 162 international division retail stores, as well as participated under licensing and merchandise arrangements in 98 stores. The company was founded in 1986 and is based in Boca Raton, Florida.
Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
1Q24 Results. Net sales were $1.87 billion, down from $2.11 billion in 1Q23 and slightly below our $1.95 billion estimate. A challenging overall economic environment and 56 fewer Office Depot stores, y-o-y, drove the revenue contraction. Adjusted EBITDA totaled $82 million, down from $131 million and below our $123 million estimate. Net income declined to $15 million, or $0.40/sh, from $72 million, or $1.71/sh. We had forecasted $64 million, or $1.72/sh.
A Decision on Varis. Put out the “For Sale” sign. Responding to shareholder suggestions, among other things, management and the Board came to the decision to sell the Varis unit, which just has not begun to generate revenue as originally anticipated. While waiting for the sale to occur, the operating costs of Varis have been reduced by approximately one-third.
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