BOSTON, Feb. 24, 2022 /PRNewswire/ -- HMH (Nasdaq:
HMHC), a learning technology company, announced financial results
for the fourth quarter and full year ended December 31, 2021.
Q4 and Full Year 2021 Financial Results:
|
|
Three Months Ended
December 31,
|
|
|
Years Ended
December 31,
|
|
(in millions of
dollars)
|
|
2021
1
|
|
|
2020
1
|
|
|
Change
|
|
|
2021
1
|
|
|
2020
1
|
|
|
Change
|
|
Net sales
|
|
$
|
179
|
|
|
$
|
141
|
|
|
|
26.7
|
%
|
|
$
|
1,051
|
|
|
$
|
840
|
|
|
|
25.0
|
%
|
Change in deferred
revenue
|
|
|
(47)
|
|
|
|
(48)
|
|
|
|
(3.0)
|
%
|
|
|
59
|
|
|
|
58
|
|
|
|
2.1
|
%
|
Billings
2
|
|
|
132
|
|
|
|
93
|
|
|
|
42.0
|
%
|
|
|
1,110
|
|
|
|
899
|
|
|
|
23.5
|
%
|
Impairment charge for
goodwill
|
|
|
—
|
|
|
|
17
|
|
|
NM
|
|
|
|
—
|
|
|
|
279
|
|
|
NM
|
|
(Loss) income from
continuing operations
|
|
|
(46)
|
|
|
|
(88)
|
|
|
|
47.4
|
%
|
|
|
2
|
|
|
|
(471)
|
|
|
NM
|
|
Adjusted EBITDA
3
|
|
|
24
|
|
|
|
(7)
|
|
|
NM
|
|
|
|
270
|
|
|
|
89
|
|
|
NM
|
|
Pre-publication or
content development costs
|
|
|
(14)
|
|
|
|
(10)
|
|
|
|
41.7
|
%
|
|
|
(56)
|
|
|
|
(61)
|
|
|
|
(7.7)
|
%
|
Net cash provided by
operating activities
|
|
|
71
|
|
|
|
40
|
|
|
|
75.7
|
%
|
|
|
264
|
|
|
|
106
|
|
|
NM
|
|
Free cash flow
3
|
|
|
47
|
|
|
|
15
|
|
|
NM
|
|
|
|
168
|
|
|
|
(5)
|
|
|
NM
|
|
________________
|
|
1
|
All amounts exclude
the impact of the HMH Books & Media business which has been
removed from continuing operations and classified as discontinued
operations since the first quarter of
2021.
|
2
|
An operating measure.
Please refer to "Operating Metrics" for an explanation.
|
3
|
A non-GAAP measure.
Please refer to Use of Non-GAAP Financial Measures for an
explanation and reconciliation. We are unable to reconcile forward
looking unlevered free cash flow without unreasonable
efforts.
|
NM = not
meaningful
|
Additional information regarding Q4 and full year 2021 financial
results will be included in the Company's Annual Report on Form
10-K.
Conference Call:
Given the recently announced agreement for HMH to be acquired by
entities affiliated with The Veritas Capital Fund VII, L.P., the
Company will not be hosting a conference call to discuss its
financial results.
Use of Non-GAAP Financial Measures:
To supplement our financial statements presented in accordance
with Generally Accepted Accounting Principles (GAAP) and to provide
additional insights into our performance, we have presented
adjusted EBITDA from continuing operations and free cash flow.
These measures are not prepared in accordance with GAAP. This
information should be considered as supplemental in nature and
should not be considered in isolation or as a substitute for the
related financial information prepared in accordance with GAAP.
Management believes that the presentation of these non-GAAP
measures provides useful information to investors regarding our
results of operations and/or our expected results of operations
because it assists both investors and management in analyzing and
benchmarking the performance and value of our business.
Management believes that the presentation of adjusted EBITDA
provides useful information to our investors and management as an
indicator of our performance that is not affected by debt
restructurings, fluctuations in interest rates or effective tax
rates, gains or losses on investments, non-cash charges and
impairment charges, levels of depreciation or amortization, and
acquisition/disposition-related activity costs, legal settlement
costs, restructuring costs and integration costs. Accordingly,
management believes that this measure is useful for comparing our
performance from period to period and makes decisions based on it.
In addition, targets in adjusted EBITDA (further adjusted to
include the change in deferred revenue) are used as performance
measures to determine certain incentive compensation of management.
Management also believes that the presentation of free cash flow
provides useful information to our investors because management
regularly reviews these metrics as an important indicator of how
much cash is generated by general business operations, excluding
capital expenditures, and makes decisions based on it.
Other companies may define these non-GAAP measures differently
and, as a result, our use of these non-GAAP measures may not be
directly comparable to adjusted EBITDA and free cash flow used by
other companies. Although we use these non-GAAP measures as
financial measures to assess our business, the use of non-GAAP
measures is limited as they include and/or do not include certain
items not included and/or included in the most directly comparable
GAAP measure. Adjusted EBITDA should be considered in addition to,
and not as a substitute for, net income or loss prepared in
accordance with GAAP as a measure of performance; and free cash
flow should be considered in addition to, and not as a substitute
for, net cash from operating activities prepared in accordance with
GAAP. Adjusted EBITDA is not intended to be a measure of liquidity
nor is free cash flow intended to be a measure of residual cash
flow available for discretionary use. You are cautioned not to
place undue reliance on these non-GAAP measures. A reconciliation
of these non-GAAP financial measures to the most directly
comparable GAAP financial measures and related disclosure is
provided in the appendix to this news release.
Operating Metrics:
Billings is an operating measure which we derive
from net sales taking into account the change in deferred revenue.
Billings for Core Solutions and Extensions is an operating measure
based on invoiced sales adjusted for returns, other publishing
income and change in deferred revenue.
About Houghton Mifflin Harcourt
Houghton Mifflin Harcourt
(Nasdaq: HMHC) is a learning technology company committed to
delivering connected solutions that engage learners, empower
educators and improve student outcomes. As a leading provider of
K–12 core curriculum, supplemental and intervention solutions, and
professional learning services, HMH partners with educators and
school districts to uncover solutions that unlock students'
potential and extend teachers' capabilities. HMH serves more than
50 million students and 3 million educators in 150
countries. For more information, visit www.hmhco.com
Follow HMH
on Twitter, Facebook, Instagram and YouTube.
Contact
Investor Relations
Chris
Symanoskie, IRC
VP, Investor Relations
410-215-1405
Chris.Symanoskie@hmhco.com
Media Relations
Bianca
Olson
SVP, Corporate Affairs
617-351-3841
Bianca.Olson@hmhco.com
Important Information
On February 22, 2022, HMH
announced that it has entered into a definitive merger agreement
with certain affiliates of Veritas Capital, a leading private
equity investment firm, for the acquisition of the Company via a
tender offer. The tender offer for the outstanding shares of HMH
common stock has not yet commenced. This communication is for
informational purposes only and is neither an offer to purchase nor
a solicitation of an offer to sell shares of HMH common stock. The
solicitation and offer to buy shares of HMH common stock will only
be made pursuant to the tender offer materials that Veritas intends
to file with the U.S. Securities and Exchange Commission (the
"SEC"). At the time the tender offer is commenced, Veritas will
file a tender offer statement on Schedule TO with the SEC, and HMH
will file a solicitation/recommendation statement on Schedule 14D-9
with respect to the tender offer. HMH's STOCKHOLDERS ARE ADVISED TO
READ THE SCHEDULE TO (INCLUDING AN OFFER TO PURCHASE, A RELATED
LETTER OF TRANSMITTAL AND OTHER OFFER DOCUMENTS) AND THE SCHEDULE
14D-9, AS EACH MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME,
AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC WHEN THEY
BECOME AVAILABLE BEFORE THEY MAKE ANY DECISION WITH RESPECT TO THE
TENDER OFFER BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT
THE PROPOSED TRANSACTION AND THE PARTIES THERETO. Both the tender
offer statement and the solicitation/recommendation statement will
be mailed to HMH's stockholders free of charge. Investors and
stockholders may obtain free copies of the Schedule TO and Schedule
14D-9, as each may be amended or supplemented from time to time,
and other documents filed by the parties (when available) at the
SEC's web site at www.sec.gov, by contacting HMH's Investor
Relations either by telephone at 410-215-1405 or e-mail at
Chris.Symanoskie@hmhco.com or on HMH's website at
www.hmhco.com.
Houghton Mifflin
Harcourt Company Consolidated Balance
Sheets
|
|
|
|
December
31,
|
|
(in thousands of
dollars, except share information)
|
|
2021
|
|
|
2020
|
|
Assets
|
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
463,131
|
|
|
$
|
281,200
|
|
Accounts receivable,
net of allowances
|
|
|
135,495
|
|
|
|
88,830
|
|
Inventories
|
|
|
117,469
|
|
|
|
145,553
|
|
Prepaid expenses and
other assets
|
|
|
43,339
|
|
|
|
19,276
|
|
Assets of discontinued
operations
|
|
|
—
|
|
|
|
160,053
|
|
Total current
assets
|
|
|
759,434
|
|
|
|
694,912
|
|
|
|
|
|
|
|
|
|
|
Property, plant, and
equipment, net
|
|
|
80,445
|
|
|
|
88,801
|
|
Pre-publication
costs, net
|
|
|
150,652
|
|
|
|
202,820
|
|
Goodwill
|
|
|
437,977
|
|
|
|
437,977
|
|
Other intangible
assets, net
|
|
|
360,290
|
|
|
|
402,484
|
|
Operating lease
assets
|
|
|
110,572
|
|
|
|
126,850
|
|
Deferred income
taxes
|
|
|
4,997
|
|
|
|
2,415
|
|
Deferred
commissions
|
|
|
35,083
|
|
|
|
30,659
|
|
Other
assets
|
|
|
34,830
|
|
|
|
34,208
|
|
Total
assets
|
|
$
|
1,974,280
|
|
|
$
|
2,021,126
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
|
Current portion of
long-term debt
|
|
$
|
—
|
|
|
$
|
19,000
|
|
Accounts
payable
|
|
|
37,449
|
|
|
|
38,751
|
|
Royalties
payable
|
|
|
45,166
|
|
|
|
34,765
|
|
Salaries, wages, and
commissions payable
|
|
|
41,253
|
|
|
|
21,723
|
|
Deferred
revenue
|
|
|
357,864
|
|
|
|
342,605
|
|
Interest
payable
|
|
|
11,235
|
|
|
|
11,017
|
|
Severance and other
charges
|
|
|
405
|
|
|
|
19,590
|
|
Accrued pension
benefits
|
|
|
185
|
|
|
|
1,593
|
|
Accrued postretirement
benefits
|
|
|
1,618
|
|
|
|
1,555
|
|
Operating lease
liabilities
|
|
|
7,539
|
|
|
|
9,669
|
|
Other
liabilities
|
|
|
43,297
|
|
|
|
22,912
|
|
Liabilities of
discontinued operations
|
|
|
—
|
|
|
|
30,662
|
|
Total current
liabilities
|
|
|
546,011
|
|
|
|
553,842
|
|
|
|
|
|
|
|
|
|
|
Long-term debt, net
of discount and issuance costs
|
|
|
317,579
|
|
|
|
624,692
|
|
Operating lease
liabilities
|
|
|
127,426
|
|
|
|
132,014
|
|
Long-term deferred
revenue
|
|
|
606,811
|
|
|
|
562,679
|
|
Accrued pension
benefits
|
|
|
8,484
|
|
|
|
24,061
|
|
Accrued
postretirement benefits
|
|
|
15,940
|
|
|
|
16,566
|
|
Deferred income
taxes
|
|
|
21,393
|
|
|
|
16,411
|
|
Other
liabilities
|
|
|
212
|
|
|
|
398
|
|
Total
liabilities
|
|
|
1,643,856
|
|
|
|
1,930,663
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
Stockholders'
equity
|
|
|
|
|
|
|
|
|
Preferred stock, $0.01
par value: 20,000,000 shares authorized; no shares issued and
outstanding at December 31, 2021 and 2020
|
|
|
—
|
|
|
|
—
|
|
Common stock, $0.01
par value: 380,000,000 shares authorized; 152,267,951 and
150,459,034 shares issued at December 31, 2021 and 2020,
respectively; 127,690,917 and 125,882,000 shares outstanding at
December 31, 2021 and 2020, respectively
|
|
|
1,523
|
|
|
|
1,505
|
|
Treasury stock,
24,577,034 shares as of December 31, 2021 and 2020, respectively,
at cost
|
|
|
(518,030)
|
|
|
|
(518,030)
|
|
Capital in excess of
par value
|
|
|
4,931,357
|
|
|
|
4,918,542
|
|
Accumulated
deficit
|
|
|
(4,042,252)
|
|
|
|
(4,255,830)
|
|
Accumulated other
comprehensive loss
|
|
|
(42,174)
|
|
|
|
(55,724)
|
|
Total stockholders'
equity
|
|
|
330,424
|
|
|
|
90,463
|
|
Total liabilities and
stockholders' equity
|
|
$
|
1,974,280
|
|
|
$
|
2,021,126
|
|
Houghton Mifflin
Harcourt Company Consolidated Statements of
Operations
|
|
|
|
(Unaudited)
Three Months
Ended
December
31,
|
|
|
Years Ended
December 31,
|
|
(in thousands of
dollars, except share and per share information)
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
Net
sales
|
|
$
|
178,805
|
|
|
$
|
141,167
|
|
|
$
|
1,050,802
|
|
|
$
|
840,454
|
|
Costs and
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales,
excluding publishing rights and pre-publication
amortization
|
|
|
63,316
|
|
|
|
60,235
|
|
|
|
398,706
|
|
|
|
370,586
|
|
Publishing rights
amortization
|
|
|
2,517
|
|
|
|
3,468
|
|
|
|
10,688
|
|
|
|
14,800
|
|
Pre-publication
amortization
|
|
|
29,444
|
|
|
|
32,047
|
|
|
|
108,621
|
|
|
|
125,838
|
|
Cost of
sales
|
|
|
95,277
|
|
|
|
95,750
|
|
|
|
518,015
|
|
|
|
511,224
|
|
Selling and
administrative
|
|
|
106,707
|
|
|
|
102,540
|
|
|
|
445,660
|
|
|
|
442,355
|
|
Other intangible
assets amortization
|
|
|
7,241
|
|
|
|
6,349
|
|
|
|
30,257
|
|
|
|
23,917
|
|
Impairment charge for
goodwill
|
|
|
—
|
|
|
|
17,000
|
|
|
|
—
|
|
|
|
279,000
|
|
Restructuring/severance and other charges
|
|
|
2,469
|
|
|
|
98
|
|
|
|
12,349
|
|
|
|
31,874
|
|
Gain on sale of
assets
|
|
|
—
|
|
|
|
—
|
|
|
|
(3,661)
|
|
|
|
—
|
|
Operating (loss)
income
|
|
|
(32,889)
|
|
|
|
(80,570)
|
|
|
|
48,182
|
|
|
|
(447,916)
|
|
Other income
(expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retirement benefits
non-service income (expense)
|
|
|
117
|
|
|
|
(1,039)
|
|
|
|
105
|
|
|
|
(856)
|
|
Interest
expense
|
|
|
(8,210)
|
|
|
|
(8,753)
|
|
|
|
(34,998)
|
|
|
|
(37,931)
|
|
Interest
income
|
|
|
25
|
|
|
|
26
|
|
|
|
77
|
|
|
|
899
|
|
Change in fair value
of derivative instruments
|
|
|
(306)
|
|
|
|
500
|
|
|
|
(1,221)
|
|
|
|
672
|
|
Gain on
investments
|
|
|
—
|
|
|
|
353
|
|
|
|
1,442
|
|
|
|
2,091
|
|
Income from
transition services agreement
|
|
|
1,411
|
|
|
|
—
|
|
|
|
3,664
|
|
|
|
—
|
|
Loss on
extinguishment of debt
|
|
|
—
|
|
|
|
—
|
|
|
|
(12,505)
|
|
|
|
—
|
|
(Loss) income from
continuing operations before taxes
|
|
|
(39,852)
|
|
|
|
(89,483)
|
|
|
|
4,746
|
|
|
|
(483,041)
|
|
Income tax expense
(benefit) for continuing operations
|
|
|
6,577
|
|
|
|
(1,141)
|
|
|
|
2,686
|
|
|
|
(12,351)
|
|
(Loss) income from
continuing operations
|
|
|
(46,429)
|
|
|
|
(88,342)
|
|
|
|
2,060
|
|
|
|
(470,690)
|
|
Income (loss) from
discontinued operations, net of tax
|
|
|
—
|
|
|
|
5,197
|
|
|
|
(1,005)
|
|
|
|
(9,148)
|
|
(Loss) gain on sale
of discontinued operations, net of tax
|
|
|
(1,997)
|
|
|
|
—
|
|
|
|
212,523
|
|
|
|
—
|
|
(Loss) income from
discontinued operations, net of tax
|
|
|
(1,997)
|
|
|
|
5,197
|
|
|
|
211,518
|
|
|
|
(9,148)
|
|
Net (loss)
income
|
|
$
|
(48,426)
|
|
|
$
|
(83,145)
|
|
|
$
|
213,578
|
|
|
$
|
(479,838)
|
|
Net (loss) income per
share attributable to common stockholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
operations
|
|
$
|
(0.36)
|
|
|
$
|
(0.70)
|
|
|
$
|
0.02
|
|
|
$
|
(3.75)
|
|
Discontinued
operations
|
|
|
(0.02)
|
|
|
|
0.04
|
|
|
|
1.66
|
|
|
|
(0.07)
|
|
Net (loss)
income
|
|
$
|
(0.38)
|
|
|
$
|
(0.66)
|
|
|
$
|
1.68
|
|
|
$
|
(3.82)
|
|
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
operations
|
|
$
|
(0.36)
|
|
|
$
|
(0.70)
|
|
|
$
|
0.02
|
|
|
$
|
(3.75)
|
|
Discontinued
operations
|
|
|
(0.02)
|
|
|
|
0.04
|
|
|
|
1.61
|
|
|
|
(0.07)
|
|
Net (loss)
income
|
|
$
|
(0.38)
|
|
|
$
|
(0.66)
|
|
|
$
|
1.63
|
|
|
$
|
(3.82)
|
|
Weighted average
shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
127,686,147
|
|
|
|
125,867,093
|
|
|
|
127,337,815
|
|
|
|
125,455,487
|
|
Diluted
|
|
|
127,686,147
|
|
|
|
125,867,093
|
|
|
|
131,402,866
|
|
|
|
125,455,487
|
|
Houghton Mifflin
Harcourt Company Consolidated Statements of Cash
Flows
|
|
|
|
Years Ended
December 31,
|
|
(in thousands of
dollars)
|
|
2021
|
|
|
2020
|
|
Cash flows from
operating activities
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$
|
213,578
|
|
|
$
|
(479,838)
|
|
Adjustments to
reconcile net income (loss) to net cash provided by operating
activities
|
|
|
|
|
|
|
|
|
Loss from discontinued
operations, net of tax
|
|
|
1,005
|
|
|
|
9,148
|
|
Gain on sale of
discontinued operations, net of tax
|
|
|
(212,523)
|
|
|
|
—
|
|
Gain on sale of
assets
|
|
|
(3,661)
|
|
|
|
—
|
|
Depreciation and
amortization expense
|
|
|
194,433
|
|
|
|
214,429
|
|
Operating lease
assets, amortization and impairments
|
|
|
16,249
|
|
|
|
5,397
|
|
Amortization of debt
discount and deferred financing costs
|
|
|
2,705
|
|
|
|
2,636
|
|
Gain on
investments
|
|
|
(1,942)
|
|
|
|
(2,091)
|
|
Deferred income
taxes
|
|
|
2,400
|
|
|
|
(14,355)
|
|
Stock-based
compensation expense
|
|
|
12,217
|
|
|
|
11,160
|
|
Write-off of property,
plant, and equipment
|
|
|
1,606
|
|
|
|
—
|
|
Loss on extinguishment
of debt
|
|
|
12,505
|
|
|
|
—
|
|
Impairment charge for
goodwill
|
|
|
—
|
|
|
|
279,000
|
|
Change in fair value
of derivative instruments
|
|
|
1,221
|
|
|
|
(672)
|
|
Changes in operating
assets and liabilities, net of acquisitions
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
(28,928)
|
|
|
|
32,369
|
|
Inventories
|
|
|
28,083
|
|
|
|
42,936
|
|
Other
assets
|
|
|
(28,895)
|
|
|
|
(4,860)
|
|
Accounts payable and
accrued expenses
|
|
|
18,788
|
|
|
|
(34,039)
|
|
Royalties payable and
author advances, net
|
|
|
13,247
|
|
|
|
(18,095)
|
|
Deferred
revenue
|
|
|
59,391
|
|
|
|
57,178
|
|
Interest
payable
|
|
|
218
|
|
|
|
7,191
|
|
Severance and other
charges
|
|
|
(19,185)
|
|
|
|
7,183
|
|
Accrued pension and
postretirement benefits
|
|
|
(2,946)
|
|
|
|
3,443
|
|
Operating lease
liabilities
|
|
|
(6,687)
|
|
|
|
(1,996)
|
|
Other
liabilities
|
|
|
(9,090)
|
|
|
|
(9,639)
|
|
Net cash provided by
operating activities - continuing operations
|
|
|
263,789
|
|
|
|
106,485
|
|
Net cash provided by
operating activities - discontinued operations
|
|
|
3,880
|
|
|
|
8,763
|
|
Net cash provided by
operating activities
|
|
|
267,669
|
|
|
|
115,248
|
|
Cash flows from
investing activities
|
|
|
|
|
|
|
|
|
Additions to
pre-publication costs
|
|
|
(56,210)
|
|
|
|
(60,872)
|
|
Additions to
property, plant, and equipment
|
|
|
(39,093)
|
|
|
|
(50,940)
|
|
Proceeds from sale of
business
|
|
|
340,593
|
|
|
|
—
|
|
Proceeds from sale of
assets
|
|
|
5,000
|
|
|
|
—
|
|
Net cash provided by
(used in) investing activities - continuing operations
|
|
|
250,290
|
|
|
|
(111,812)
|
|
Net cash used in
investing activities - discontinued operations
|
|
|
(647)
|
|
|
|
(459)
|
|
Net cash provided by
(used in) investing activities
|
|
|
249,643
|
|
|
|
(112,271)
|
|
Cash flows from
financing activities
|
|
|
|
|
|
|
|
|
Borrowings under
revolving credit facility
|
|
|
—
|
|
|
|
150,000
|
|
Payments of revolving
credit facility
|
|
|
—
|
|
|
|
(150,000)
|
|
Payments of long-term
debt
|
|
|
(342,031)
|
|
|
|
(19,000)
|
|
Tax withholding
payments related to net share settlements of restricted stock
units
|
|
|
—
|
|
|
|
(48)
|
|
Issuance of common
stock under employee stock purchase plan
|
|
|
410
|
|
|
|
918
|
|
Net collections under
transition services agreement
|
|
|
6,240
|
|
|
|
—
|
|
Net cash used in
financing activities - continuing operations
|
|
|
(335,381)
|
|
|
|
(18,130)
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
|
181,931
|
|
|
|
(15,153)
|
|
Cash and cash
equivalents at beginning of the period
|
|
|
281,200
|
|
|
|
296,353
|
|
Cash and cash
equivalents at end of the period
|
|
$
|
463,131
|
|
|
$
|
281,200
|
|
Houghton Mifflin
Harcourt Company Non-GAAP Reconciliations
(Unaudited)
|
|
Adjusted EBITDA
1
|
|
(in thousands of
dollars)
|
|
|
|
Three Months Ended
December 31,
|
|
|
Years Ended
December 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
Net (loss) income
from continuing operations
|
|
$
|
(46,429)
|
|
|
$
|
(88,342)
|
|
|
$
|
2,060
|
|
|
$
|
(470,690)
|
|
Interest
expense
|
|
|
8,210
|
|
|
|
8,753
|
|
|
|
34,998
|
|
|
|
37,931
|
|
Interest
income
|
|
|
(25)
|
|
|
|
(26)
|
|
|
|
(77)
|
|
|
|
(899)
|
|
Provision (benefit)
for income taxes
|
|
|
6,577
|
|
|
|
(1,247)
|
|
|
|
2,686
|
|
|
|
(12,457)
|
|
Depreciation
expense
|
|
|
10,533
|
|
|
|
12,492
|
|
|
|
44,867
|
|
|
|
49,874
|
|
Amortization
expense
|
|
|
39,202
|
|
|
|
41,864
|
|
|
|
149,566
|
|
|
|
164,555
|
|
Non-cash
charges—goodwill impairment
|
|
|
—
|
|
|
|
17,000
|
|
|
|
—
|
|
|
|
279,000
|
|
Non-cash
charges—stock-compensation
|
|
|
3,490
|
|
|
|
2,865
|
|
|
|
12,217
|
|
|
|
11,160
|
|
Non-cash charges—
(gain) loss on derivative instruments
|
|
|
306
|
|
|
|
(500)
|
|
|
|
1,221
|
|
|
|
(672)
|
|
Fees, expenses or
charges for equity offerings,
debt or
acquisitions/dispositions
|
|
|
29
|
|
|
|
714
|
|
|
|
895
|
|
|
|
1,080
|
|
Gain on
investments
|
|
|
(500)
|
|
|
|
(353)
|
|
|
|
(1,942)
|
|
|
|
(2,091)
|
|
Gain on sale of
assets
|
|
|
—
|
|
|
|
—
|
|
|
|
(3,661)
|
|
|
|
—
|
|
Loss on
extinguishment of debt
|
|
|
—
|
|
|
|
—
|
|
|
|
12,505
|
|
|
|
—
|
|
Legal
settlement
|
|
|
—
|
|
|
|
—
|
|
|
|
2,470
|
|
|
|
—
|
|
Restructuring/severance and other charges
|
|
|
2,469
|
|
|
|
98
|
|
|
|
12,349
|
|
|
|
31,874
|
|
Adjusted EBITDA from
continuing operations
|
|
$
|
23,862
|
|
|
$
|
(6,682)
|
|
|
$
|
270,154
|
|
|
$
|
88,665
|
|
|
Free Cash Flow
1
|
|
(in thousands of
dollars)
|
|
|
|
Three Months Ended
December 31,
|
|
|
Years Ended
December 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
Cash flows from
operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
|
$
|
71,092
|
|
|
$
|
40,468
|
|
|
$
|
263,789
|
|
|
$
|
106,485
|
|
Cash flows from
investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additions to
pre-publication costs
|
|
|
(14,106)
|
|
|
|
(9,953)
|
|
|
|
(56,210)
|
|
|
|
(60,872)
|
|
Additions to
property, plant, and equipment
|
|
|
(10,421)
|
|
|
|
(15,665)
|
|
|
|
(39,093)
|
|
|
|
(50,940)
|
|
Free Cash
Flow
|
|
$
|
46,565
|
|
|
$
|
14,850
|
|
|
$
|
168,486
|
|
|
$
|
(5,327)
|
|
|
|
1
|
All amounts have been
adjusted to eliminate the impact of the HMH Books & Media
business which has been removed from continuing operations and
classified as discontinued operations.
|
Houghton Mifflin
Harcourt Company Calculation of Billings
(Unaudited)
|
|
Billings
1
|
|
(in thousands of
dollars)
|
|
|
|
Three Months
Ended
December
31,
|
|
|
Years
Ended
December
31,
|
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
Net sales
|
|
$
|
178,805
|
|
|
$
|
141,167
|
|
|
$
|
1,050,802
|
|
|
$
|
840,454
|
|
Change in deferred
revenue
|
|
|
(46,709)
|
|
|
|
(48,169)
|
|
|
|
59,391
|
|
|
|
58,178
|
|
Billings
|
|
$
|
132,096
|
|
|
$
|
92,998
|
|
|
$
|
1,110,193
|
|
|
$
|
898,632
|
|
|
Billings is an
operating measure utilized by the Company derived as shown
above.
|
|
1
|
All amounts have been
adjusted to eliminate the impact of the HMH Books & Media
business which has been removed from continuing operations and
classified as discontinued operations.
|
View original content to download
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SOURCE Houghton Mifflin Harcourt