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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 14, 2023
EXELA TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
Delaware |
|
001-36788 |
|
47-1347291 |
(State or other jurisdiction
of incorporation) |
|
(Commission
File Number) |
|
(I.R.S. Employer
Identification No.) |
2701 East Grauwyler Road
Irving, Texas |
|
75061 |
(Address of principal executive offices) |
|
(Zip Code) |
(844)
935-2832
(Registrant's
telephone number, including area code)
N/A
(Former name or former address, if changed since
last report)
Check the appropriate box below if the Form 8-K
filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class |
Trading Symbol |
Name of Each Exchange on Which Registered |
Common stock, par value $0.0001 per share |
XELA |
The Nasdaq Stock Market LLC |
6.00% Series B Cumulative Convertible Perpetual Preferred Stock, par value $0.0001 per share |
XELAP |
The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is
an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of
the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
¨ Emerging
growth company
If an emerging growth company, indicate
by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Item 2.02 |
Results of Operation and Financial Condition. |
On August 14, 2023, Exela Technologies, Inc.
(the “Company”) issued a press release announcing its preliminary financial results for the quarter ended June 30, 2023. A
copy of the press release is furnished herewith as Exhibit 99.1.
The information in this Current Report on
Form 8-K furnished pursuant to Item 2.02, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section
18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liability under that section,
and they shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act,
except as shall be expressly set forth by specific reference in such filing. The Company is making reference to non-GAAP financial information
in the press release. A reconciliation of the non-GAAP financial measures to the comparable GAAP financial measures is contained in the
attached press release.
Item 3.01 |
Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing. |
On August 11, 2023, the Company received a
notice of non-compliance from Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that, as a result of the Company’s
failure to timely file its Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2023 (the “Form 10-Q”), the
Company is not in compliance with Nasdaq Listing Rule 5250(c)(1) (the “Rule”), which requires listed companies to timely file
all periodic financial reports with the U.S. Securities and Exchange Commission (the “SEC”). Under Nasdaq’s listing
rules, the Company has 60 calendar days to submit a plan to regain compliance. If the plan is accepted by Nasdaq, the Company can be granted
up to 180 calendar days from the Form 10-Q due date, or until or until February 5, 2024, to regain compliance.
Item 9.01 |
Financial Statements and Exhibits. |
(d) Exhibits
* Furnished herewith
SIGNATURE
Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
Dated: August 14, 2023
|
EXELA TECHNOLOGIES, INC. |
|
|
|
By: |
/s/ Erik Mengwall |
|
|
Name: |
Erik Mengwall |
|
|
Title: |
Secretary |
Exhibit 99.1
Exela Technologies,
Inc. Reports
Preliminary Second Quarter 2023 Results
Preliminary Second Quarter Highlights
| ● | Revenue
of $272.9 million, up 2.3% year-over-year (up 2.5% on a constant currency basis) |
| ● | Net
loss of $30.9 million |
| ● | Gross
profit(1) of $60.9 million, up 23.0% or $11.4 million year-over-year, with a
corresponding margin of 22.3% and up 3.8% year-over-year and up 1.4% sequentially |
| ● | Adjusted
EBITDA of $40.9 million, up 12.1% year-over-year, with a corresponding margin of 15.0% and
up 17.8% sequentially |
| ● | $106.2
million in new TCV(2) wins and renewal of $32.8M TCV reflect strength of award-winning
best-in-class solutions and services |
| ● | Long-term
Liability(3) reduced to $792 million from $1.608 billion |
| ● | Value
enhancing initiatives include Completion of Debt Recapitalization and XBP Europe progress |
Conference
call scheduled for August 14, 2023 at 8:30 AM ET
Irving, TX –
August 14, 2023 – Exela Technologies, Inc. (“Exela” or the “Company”) (NASDAQ: XELA, XELAP), a global
business process automation leader, announced today its financial results for the second quarter ended June 30, 2023.
“Our improving metrics in the second quarter are a result of
many factors but certain ones stand above all - focus on cost management, debt reduction and the value proposition of our services and
solutions enhanced by evolving AI,” said Par Chadha, Executive Chairman of Exela.
Second Quarter
Highlights
| ● | Revenue:
Revenue for Q2 2023 was $272.9 million, up 2.3% compared to $266.8 million in Q2 2022. |
| ● | Revenue
for the Information and Transaction Processing Solutions segment was $185.0 million, a decrease
of 2.6% year-over-year, primarily due to lower volumes, customers rebalancing portfolios
and attrition. |
| ● | Healthcare
Solutions revenue was $63.6 million, an increase of 12.8% year-over-year, led by higher volumes
from our new and existing customers. |
| ● | Legal
and Loss Prevention Services revenue was $24.3 million, an increase of 19.5% year-over-year
due to higher demand for services. |
Operating income/(loss):
Operating income for Q2 2023 was $11.2 million, compared with operating loss of $20.9 million in Q2 2022. The $32.1 million year
over year improvement was primarily driven by higher revenue, lower cost of revenue, lower Selling, General and Administrative Expenses
including a gain from sale of an asset.
| ● | Net
Loss: Net loss for Q2 2023 was $30.9 million, compared with a net loss of $79.2 million
in Q2 2022. |
| ● | EBITDA(4):
EBITDA for Q2 2023 was $31.6 million compared to a loss of $17.6 million in Q2 2022.
EBITDA margin for Q2 2023 was 11.6% compared to (6.6)% in Q2 2022. |
| ● | Adjusted
EBITDA(5): Adjusted EBITDA for Q2 2023 was $40.9 million, an increase
of 12.1% compared to $36.5 million in Q2 2022. Adjusted EBITDA margin for Q2 2023 was 15.0%,
an increase of 130 basis points from 13.7% in Q2 2022. |
Capital Expenditures:
Capital expenditures for Q2 2023 were 1.4% of revenue compared to 2% of revenue in Q2 2022
Nasdaq Non-Compliance Notice
On August 11, 2023,
Exela received a notice of non-compliance from Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that, as a result
of the Company’s failure to timely file its Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2023 (the “Form
10-Q”), the Company is not in compliance with Nasdaq Listing Rule 5250(c)(1) (the “Rule”), which requires listed companies
to timely file all periodic financial reports with the U.S. Securities and Exchange Commission (the “SEC”). Under Nasdaq’s
listing rules, the Company has 60 calendar days to submit a plan to regain compliance. If the plan is accepted by Nasdaq, the Company
can be granted up to 180 calendar days from the Form 10-Q due date, or until or until February 5, 2024, to regain compliance. The Company
expects to complete its Form 10-Q and intends to file the Form 10-Q as soon as practicable to regain compliance with the Rule within
the time period to provide the plan of compliance.
Earnings Conference Call and Audio
Webcast
Exela will host
a conference call to discuss its second quarter 2023 financial results at 8:30 AM ET on August 14, 2023. To access this call, dial 833-255-2831
or +1-412-902-6724 (international). The password for the call is “Exela Earnings Call”.
Shortly after the
conclusion of the call, a replay will be available through May 18, 2023 at 877-344-7529 or +1-412-317-0088 (international). The replay
passcode is 20333000. A replay will also be archived on the Exela investor relations website at http://investors.exelatech.com.
Exela invites all
investors to ask questions that they would like addressed on the conference call. We ask investors to submit questions via email to IR@exelatech.com.
A live webcast
of this conference call will be available on the “Investors” page of the Company’s website (www.exelatech.com).
A supplemental slide presentation that accompanies this call and webcast can be found on the investor relations website (http://investors.exelatech.com/)
and will remain available after the call.
Below are the
notes referenced above:
| (1) | Gross
Profit is defined as revenue less cost of revenue excluding depreciation and amortization |
| (2) | TCV:
Total Contract Value, the aggregate $USD value of a contract over its life |
| (3) | Long-term
liability: Includes senior secured term loan and revolving facility, senior secured 2023
notes, senior secured 2026 notes, Securitization facility and interest-bearing current liabilities
calculated ending July 2023 beginning June 2021 |
| (4) | EBITDA
is a non-GAAP measure. A reconciliation of EBITDA is attached to this release. |
| (5) | Adjusted EBITDA is a non-GAAP
measure. A reconciliation of Adjusted EBITDA is attached to this release. |
About Exela
Exela Technologies is a business
process automation (BPA) leader, leveraging a global footprint and proprietary technology to provide digital transformation solutions
enhancing quality, productivity, and end-user experience. With decades of experience operating mission-critical processes, Exela serves
a growing roster of more than 4,000 customers throughout 50 countries, including over 60% of the Fortune® 100. Utilizing foundational
technologies spanning information management, workflow automation, and integrated communications, Exela’s software and services
include multi-industry, departmental solution suites addressing finance and accounting, human capital management, and legal management,
as well as industry-specific solutions for banking, healthcare, insurance, and the public sector. Through cloud-enabled platforms, built
on a configurable stack of automation modules, and approximately 15,500 employees operating in 21 countries, Exela rapidly
deploys integrated technology and operations as an end-to-end digital journey partner.
Find out more at
www.exelatech.com
To automatically receive Exela financial
news by e-mail, please visit the Exela Investor Relations website, http://investors.exelatech.com/, and subscribe to E-mail Alerts.
Financial Disclosure
Advisory
The preliminary unaudited financial
results included in this press release are based on information available as of August 14, 2023 and management’s review of operations
and financial results for the second quarter of 2023. Actual results may be materially different from these preliminary financial results.
They remain subject to change based on the completion of customary review procedures and are forward-looking statements. The Company
assumes no obligation to update these statements, except as may be required by law. The actual results may be materially different and
are affected by the risk factors and uncertainties identified in this press release and in the Company's annual and quarterly filings
with the SEC. An independent registered public accounting firm has not reviewed or performed any procedures with respect to the preliminary
unaudited financial information included in this release. The Company expects to file a quarterly report on Form 10-Q with respect to
the period ended June 30, 2023, once an independent registered public accounting firm has reviewed the relevant unaudited financial information.
About Non-GAAP Financial Measures
This press release includes constant
currency, EBITDA and Adjusted EBITDA, each of which is a financial measure that is not prepared in accordance with U.S. generally accepted
accounting principles (“GAAP”). Exela believes that the presentation of these non-GAAP financial measures will provide useful
information to investors in assessing our financial performance, results of operations and liquidity and allows investors to better understand
the trends in our business and to better understand and compare our results. Exela’s board of directors and management use constant
currency, EBITDA and Adjusted EBITDA to assess Exela’s financial performance, because it allows them to compare Exela’s operating
performance on a consistent basis across periods by removing the effects of Exela’s capital structure (such as varying levels of
debt and interest expense, as well as transaction costs resulting from the combination of Quinpario Acquisition Corp. 2, SourceHOV Holdings,
Inc. and Novitex Holdings, Inc. on July 12, 2017 (the “Novitex Business Combination”) and capital markets-based activities).
Adjusted EBITDA also seeks to remove the effects of integration and related costs to achieve the savings, any expected reduction
in operating expenses due to the Novitex Business Combination, asset base (such as depreciation and amortization) and other similar non-routine
items outside the control of our management team. Optimization and restructuring expenses and merger adjustments are primarily
related to the implementation of strategic actions and initiatives related to the Novitex Business Combination. All of these costs are
variable and dependent upon the nature of the actions being implemented and can vary significantly driven by business needs. Accordingly,
due to that significant variability, we exclude these charges since we do not believe they truly reflect our past, current or future
operating performance. The constant currency presentation excludes the impact of fluctuations in foreign currency exchange rates. We
calculate constant currency revenue and Adjusted EBITDA on a constant currency basis by converting our current-period local currency
financial results using the exchange rates from the corresponding prior-period and compare these adjusted amounts to our corresponding
prior period reported results. Exela does not consider these non-GAAP measures in isolation or as an alternative to liquidity or financial
measures determined in accordance with GAAP. A limitation of these non-GAAP financial measures is that they exclude significant expenses
and income that are required by GAAP to be recorded in Exela’s financial statements. In addition, they are subject to inherent
limitations as they reflect the exercise of judgments by management about which expenses and income are excluded or included in determining
these non-GAAP financial measures and therefore the basis of presentation for these measures may not be comparable to similarly-titled
measures used by other companies. These non-GAAP financial measures are not required to be uniformly applied, are not audited and should
not be considered in isolation or as substitutes for results prepared in accordance with GAAP. Net loss is the GAAP measure most directly
comparable to the non-GAAP measures presented here. For reconciliation of the comparable GAAP measures to these non-GAAP financial measures,
see the schedules attached to this release.
Forward-Looking
Statements
Certain statements
included in this press release are not historical facts but are forward-looking statements for purposes of the safe harbor provisions
under The Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are accompanied by words such as “may”,
“should”, “would”, “plan”, “intend”, “anticipate”, “believe”,
“estimate”, “predict”, “potential”, “seem”, “seek”, “continue”,
“future”, “will”, “expect”, “outlook” or other similar words, phrases or expressions.
These forward-looking statements include statements regarding our industry, future events, estimated or anticipated future results and
benefits, future opportunities for Exela, and other statements that are not historical facts. These statements are based on the current
expectations of Exela management and are not predictions of actual performance. These statements are subject to a number of risks and
uncertainties, including without limitation the network outage described in this press release and those discussed under the heading
“Risk Factors” in our Annual Report and in subsequent filings with the U.S. Securities and Exchange Commission (“SEC”).
In addition, forward-looking statements provide Exela’s expectations, plans or forecasts of future events and views as of the date
of this communication. Exela anticipates that subsequent events and developments will cause Exela’s assessments to change. These
forward-looking statements should not be relied upon as representing Exela’s assessments as of any date subsequent to the date
of this press release.
For more Exela news, commentary,
and industry perspectives, visit:
Website: https://investors.exelatech.com/
Twitter: @ExelaTech
LinkedIn: /exela-technologies
Facebook: @exelatechnologies
Instagram: @exelatechnologies
The information posted on the Company's
website and/or via its social media accounts may be deemed material to investors. Accordingly, investors, media and others interested
in the Company should monitor the Company's website and its social media accounts in addition to the Company's press releases, SEC filings
and public conference calls and webcasts.
Investor and/or
Media Contacts:
Vincent Kondaveeti
E: vincent.kondaveeti@exelatech.com
Mary Beth Benjamin
E: IR@exelatech.com
Source: Exela Technologies,
Inc.
Exela Technologies,
Inc. and Subsidiaries
Condensed
Consolidated Balance Sheets
As of June
30, 2023 and December 31, 2022
(in thousands
of United States dollars except share and per share amounts)
| |
June 30, | | |
December 31, | |
| |
2023 | | |
2022 | |
| |
(Unaudited and
Not Reviewed) | | |
(Audited) | |
Assets | |
| | | |
| | |
Current assets | |
| | | |
| | |
Cash and cash equivalents | |
$ | 10,718 | | |
$ | 15,073 | |
Restricted cash | |
| 42,792 | | |
| 29,994 | |
Accounts receivable, net of allowance for credit losses of $6,927 and $6,402, respectively | |
| 106,831 | | |
| 101,616 | |
Related party receivables and prepaid expenses | |
| 463 | | |
| 759 | |
Inventories, net | |
| 11,055 | | |
| 16,848 | |
Prepaid expenses and other current assets | |
| 21,463 | | |
| 26,206 | |
Total current assets | |
| 193,322 | | |
| 190,496 | |
Property, plant and equipment, net of accumulated depreciation of $214,611 and $207,520, respectively | |
| 62,972 | | |
| 71,694 | |
Operating lease right-of-use assets, net | |
| 37,400 | | |
| 40,734 | |
Goodwill | |
| 170,391 | | |
| 186,802 | |
Intangible assets, net | |
| 182,350 | | |
| 200,982 | |
Deferred income tax assets | |
| 1,584 | | |
| 1,483 | |
Other noncurrent assets | |
| 26,785 | | |
| 29,721 | |
Total assets | |
$ | 674,804 | | |
$ | 721,912 | |
| |
| | | |
| | |
Liabilities and Stockholders' Equity (Deficit) | |
| | | |
| | |
Liabilities | |
| | | |
| | |
Current liabilities | |
| | | |
| | |
Accounts payable | |
$ | 64,105 | | |
$ | 79,249 | |
Related party payables | |
| 1,773 | | |
| 2,473 | |
Income tax payable | |
| (539 | ) | |
| 2,045 | |
Accrued liabilities | |
| 69,324 | | |
| 61,340 | |
Accrued compensation and benefits | |
| 50,691 | | |
| 54,143 | |
Accrued interest | |
| 60,103 | | |
| 60,901 | |
Customer deposits | |
| 15,906 | | |
| 16,955 | |
Deferred revenue | |
| 12,039 | | |
| 16,405 | |
Obligation for claim payment | |
| 62,294 | | |
| 44,380 | |
Current portion of finance lease liabilities | |
| 5,469 | | |
| 5,485 | |
Current portion of operating lease liabilities | |
| 11,079 | | |
| 11,867 | |
Current portion of long-term debts | |
| 106,372 | | |
| 154,802 | |
Total current liabilities | |
| 458,616 | | |
| 510,045 | |
Long-term debt, net of current maturities | |
| 958,005 | | |
| 942,035 | |
Finance lease liabilities, net of current portion | |
| 7,745 | | |
| 9,448 | |
Pension liabilities, net | |
| 17,732 | | |
| 16,917 | |
Deferred income tax liabilities | |
| 11,968 | | |
| 11,180 | |
Long-term income tax liabilities | |
| 3,801 | | |
| 2,742 | |
Operating lease liabilities, net of current portion | |
| 27,991 | | |
| 31,030 | |
Other long-term liabilities | |
| 5,955 | | |
| 6,104 | |
Total liabilities | |
| 1,491,813 | | |
| 1,529,501 | |
Commitments and Contingencies (Note 8) | |
| | | |
| | |
| |
| | | |
| | |
Stockholders' equity (deficit) | |
| | | |
| | |
Common Stock, par value of $0.0001 per share; 1,600,000,000 shares authorized; 6,365,965 shares issued and 6,365,353 shares outstanding at June 30, 2023 and 1,393,889 shares issued and 1,393,276 shares outstanding at December 31, 2022 | |
| 261 | | |
| 162 | |
Preferred stock, $0.0001 par value per share, 20,000,000 shares authorized at June 30, 2023 and December 31, 2022, respectively | |
| | | |
| | |
Series A Preferred Stock, 2,778,111 shares issued and outstanding at June 30, 2023 and December 31, 2022 | |
| 1 | | |
| 1 | |
Series B Preferred Stock, 3,029,900 shares issued and outstanding at June 30, 2023 and December 31, 2022 | |
| — | | |
| — | |
Additional paid in capital | |
| 1,169,517 | | |
| 1,102,619 | |
Less: Common Stock held in treasury, at cost; 612 shares at June 30, 2023 and December 31, 2022 | |
| (10,949 | ) | |
| (10,949 | ) |
Equity-based compensation | |
| 57,272 | | |
| 56,958 | |
Accumulated deficit | |
| (2,024,331 | ) | |
| (1,948,009 | ) |
Accumulated other comprehensive loss: | |
| | | |
| | |
Foreign currency translation adjustment | |
| (4,992 | ) | |
| (4,788 | ) |
Unrealized pension actuarial losses, net of tax | |
| (3,788 | ) | |
| (3,583 | ) |
Total accumulated other comprehensive loss | |
| (8,780 | ) | |
| (8,371 | ) |
Total stockholders’ deficit | |
| (817,009 | ) | |
| (807,589 | ) |
Total liabilities and stockholders’ deficit | |
$ | 674,804 | | |
$ | 721,912 | |
Exela Technologies,
Inc. and Subsidiaries
Condensed Consolidated
Statements of Operations
For the three
and six months ended June 30, 2023 and 2022
(in thousands
of United States dollars except share and per share amounts)
(Unaudited)
| |
Three Months Ended June 30, | | |
Six Months Ended June 30, | |
| |
2023 (Not
Reviewed) | | |
2022 | | |
2023 (Not
Reviewed) | | |
2022 | |
Revenue | |
$ | 272,938 | | |
$ | 266,770 | | |
$ | 546,558 | | |
$ | 546,168 | |
Cost of revenue (exclusive of depreciation and amortization) | |
| 212,059 | | |
| 217,277 | | |
| 428,526 | | |
| 440,781 | |
Selling, general and administrative expenses (exclusive of depreciation and amortization) | |
| 32,026 | | |
| 50,195 | | |
| 76,407 | | |
| 93,235 | |
Depreciation and amortization | |
| 14,890 | | |
| 17,993 | | |
| 31,450 | | |
| 36,205 | |
Related party expense | |
| 2,739 | | |
| 2,186 | | |
| 5,851 | | |
| 4,173 | |
Operating profit (loss) | |
| 11,224 | | |
| (20,881 | ) | |
| 4,324 | | |
| (28,226 | ) |
Other expense (income), net: | |
| | | |
| | | |
| | | |
| | |
Interest expense, net | |
| 45,092 | | |
| 42,271 | | |
| 89,272 | | |
| 82,031 | |
Debt modification and extinguishment costs (gain), net | |
| (6,785 | ) | |
| 8,117 | | |
| (15,558 | ) | |
| 9,001 | |
Sundry expense (income), net | |
| 1,500 | | |
| (741 | ) | |
| 2,248 | | |
| (434 | ) |
Other expense (income), net | |
| (232 | ) | |
| 7,375 | | |
| (514 | ) | |
| 13,534 | |
Net loss before income taxes | |
| (28,351 | ) | |
| (77,903 | ) | |
| (71,124 | ) | |
| (132,358 | ) |
Income tax expense | |
| (2,535 | ) | |
| (1,296 | ) | |
| (5,198 | ) | |
| (3,797 | ) |
Net loss | |
$ | (30,886 | ) | |
$ | (79,199 | ) | |
$ | (76,322 | ) | |
$ | (136,155 | ) |
Cumulative dividends for Series A Preferred Stock | |
| (967 | ) | |
| (876 | ) | |
| (1,921 | ) | |
| (1,740 | ) |
Cumulative dividends for Series B Preferred Stock | |
| (1,171 | ) | |
| (1,317 | ) | |
| (2,324 | ) | |
| (1,392 | ) |
Net loss attributable to common stockholders | |
$ | (33,024 | ) | |
$ | (81,392 | ) | |
$ | (80,567 | ) | |
$ | (139,287 | ) |
Loss per share: | |
| | | |
| | | |
| | | |
| | |
Basic and diluted | |
$ | (5.19 | ) | |
$ | (643.71 | ) | |
$ | (14.40 | ) | |
$ | (1,310.32 | ) |
Exela Technologies,
Inc. and Subsidiaries
Condensed Consolidated
Statements of Cash Flows
For the six months
ended June 30, 2023 and 2022
(in thousands
of United States dollars except share and per share amounts)
(Unaudited)
| |
| | |
| |
| |
Six Months Ended June 30, | |
| |
2023 (Not
Reviewed) | | |
2022 | |
Cash flows from operating activities | |
| | | |
| | |
Net loss | |
$ | (76,322 | ) | |
$ | (136,155 | ) |
Adjustments to reconcile net loss | |
| | | |
| | |
Depreciation and amortization | |
| 31,450 | | |
| 36,205 | |
Original issue discount and debt issuance cost amortization | |
| 16,064 | | |
| 5,804 | |
Debt modification and extinguishment costs (gain), net | |
| (16,964 | ) | |
| 3,533 | |
Credit loss expense | |
| 2,865 | | |
| 285 | |
Deferred income tax provision | |
| 776 | | |
| 1,383 | |
Share-based compensation expense | |
| 313 | | |
| 836 | |
Unrealized foreign currency losses (gain) | |
| 521 | | |
| (989 | ) |
Loss (Gain) on sale of assets | |
| (5,831 | ) | |
| 508 | |
Change in operating assets and liabilities, net of effect from acquisitions | |
| | | |
| | |
Accounts receivable | |
| (7,703 | ) | |
| 80,674 | |
Prepaid expenses and other assets | |
| 6,495 | | |
| (10,870 | ) |
Accounts payable and accrued liabilities | |
| (639 | ) | |
| 45,148 | |
Related party payables | |
| (403 | ) | |
| (23 | ) |
Additions to outsource contract costs | |
| (298 | ) | |
| (199 | ) |
Net cash provided by (used in) operating activities | |
| (49,676 | ) | |
| 26,140 | |
| |
| | | |
| | |
Cash flows from investing activities | |
| | | |
| | |
Purchase of property, plant and equipment | |
| (3,357 | ) | |
| (10,689 | ) |
Additions to patents | |
| — | | |
| (15 | ) |
Additions to internally developed software | |
| (1,976 | ) | |
| (1,736 | ) |
Proceeds from sale of assets | |
| 29,811 | | |
| 194 | |
Net cash provided by (used in) investing activities | |
| 24,478 | | |
| (12,246 | ) |
| |
| | | |
| | |
Cash flows from financing activities | |
| | | |
| | |
Proceeds from issuance of Common Stock from at the market offerings | |
| 69,260 | | |
| 177,388 | |
Dividend paid on Series B Preferred Stock | |
| — | | |
| (1,396 | ) |
Payment for fractional shares on reverse stock split | |
| (28 | ) | |
| — | |
Cash paid for equity issuance costs from at the market offerings | |
| (2,232 | ) | |
| (6,493 | ) |
Borrowings under factoring arrangement and Securitization Facility | |
| 62,858 | | |
| 69,143 | |
Principal repayment on borrowings under factoring arrangement and Securitization Facility | |
| (63,577 | ) | |
| (160,684 | ) |
Cash paid for withholding taxes on vested RSUs | |
| — | | |
| (195 | ) |
Lease terminations | |
| — | | |
| (15 | ) |
Cash paid for debt issuance costs | |
| (6,398 | ) | |
| (7,125 | ) |
Principal payments on finance lease obligations | |
| (2,150 | ) | |
| (2,884 | ) |
Borrowings from senior secured revolving facility and BRCC revolver | |
| 9,600 | | |
| 12,500 | |
Repayments on senior secured revolving facility | |
| — | | |
| (49,477 | ) |
Proceeds from issuance of 2026 Notes | |
| — | | |
| 56,583 | |
Borrowings from other loans | |
| 24,289 | | |
| 5,491 | |
Cash paid for debt repurchases | |
| (11,858 | ) | |
| — | |
Proceeds from Second Lien Note | |
| 31,500 | | |
| — | |
Repayment of BRCC term loan | |
| (44,775 | ) | |
| (46,202 | ) |
Principal repayments on senior secured term loans and other loans | |
| (32,991 | ) | |
| (15,007 | ) |
Net cash provided by financing activities | |
| 33,498 | | |
| 31,627 | |
Effect of exchange rates on cash | |
| 143 | | |
| (404 | ) |
Net increase in cash and cash equivalents | |
| 8,443 | | |
| 45,117 | |
Cash, restricted cash, and cash equivalents | |
| | | |
| | |
Beginning of period | |
| 45,067 | | |
| 48,060 | |
End of period | |
$ | 53,510 | | |
$ | 93,177 | |
Supplemental cash flow data: | |
| | | |
| | |
Income tax payments, net of refunds received | |
$ | 2,898 | | |
$ | 4,453 | |
Interest paid | |
| 72,608 | | |
| 19,103 | |
Noncash investing and financing activities: | |
| | | |
| | |
Assets acquired through right-of-use arrangements | |
| 405 | | |
| 231 | |
Accrued capital expenditures | |
| 2,167 | | |
| 1,400 | |
Exela Technologies
Schedule 1: Second
Quarter 2023 vs. Second Quarter 2022
Financial Performance
$
in million | |
Q2-2023 | | |
Q2-2022 | | |
Increase
(Decrease)
YoY ($ mn) | | |
Increase
(Decrease)
YoY (%) | | |
YTD'23 | | |
YTD'22 | | |
Increase
(Decrease)
YoY ($ mn) | | |
Increase
(Decrease)
YoY (%) | |
Information
and Transaction Processing Solutions | |
$ | 185.0 | | |
$ | 190.0 | | |
$ | (5.0 | ) | |
| (2.6 | )% | |
| 378.7 | | |
| 395.0 | | |
| (16.3 | ) | |
| (4.1 | )% |
Healthcare Solutions | |
| 63.6 | | |
| 56.4 | | |
| 7.2 | | |
| 12.8 | % | |
| 126.6 | | |
| 113.0 | | |
| 13.6 | | |
| 12.0 | % |
Legal and
Loss Prevention Services | |
| 24.3 | | |
| 20.4 | | |
| 3.9 | | |
| 19.5 | % | |
| 41.2 | | |
| 38.2 | | |
| 3.0 | | |
| 7.9 | % |
Total
Revenue | |
$ | 272.9 | | |
$ | 266.8 | | |
$ | 6.2 | | |
| 2.3 | % | |
| 546.6 | | |
| 546.2 | | |
| 0.4 | | |
| 0.1 | % |
Gross profit | |
| 60.9 | | |
| 49.5 | | |
| 11.4 | | |
| 23.0 | % | |
| 118.0 | | |
| 105.4 | | |
| 12.6 | | |
| 12.0 | % |
Gross
profit margin | |
| 22.3 | % | |
| 18.6 | % | |
| 3.8 | % | |
| 380 | bps | |
| 21.6 | % | |
| 19.3 | % | |
| 2.3 | % | |
| 230 | bps |
SG&A | |
| 32.0 | | |
| 50.2 | | |
| (18.2 | ) | |
| (36.2 | )% | |
| 76.4 | | |
| 93.2 | | |
| (16.8 | ) | |
| (18.0 | )% |
Operating (loss) income | |
| 11.2 | | |
| (20.9 | ) | |
| 32.1 | | |
| (153.8 | )% | |
| 4.3 | | |
| (28.2 | ) | |
| 32.6 | | |
| (115.3 | )% |
Operating
margin | |
| 4.1 | % | |
| (7.8 | )% | |
| 11.9 | % | |
| 1190 | bps | |
| 0.8 | % | |
| (5.2 | )% | |
| 6.0 | % | |
| 600 | bps |
Net income (loss) | |
| (30.9 | ) | |
| (79.2 | ) | |
| 48.3 | | |
| (61.0 | )% | |
| (76.3 | ) | |
| (136.2 | ) | |
| 59.8 | | |
| (43.9 | )% |
Net
income margin | |
| (11.3 | )% | |
| (29.7 | )% | |
| 18.4 | % | |
| 1840 | bps | |
| (14.0 | )% | |
| (24.9 | )% | |
| 11.0 | % | |
| 1100 | bps |
EBITDA | |
| 31.6 | | |
| (17.6 | ) | |
| 49.3 | | |
| (279.3 | )% | |
| 49.6 | | |
| (14.1 | ) | |
| 63.7 | | |
| (451.2 | )% |
EBITDA
Margin | |
| 11.6 | % | |
| (6.6 | )% | |
| 18.2 | % | |
| 1820 | bps | |
| 9.1 | % | |
| (2.6 | )% | |
| 11.7 | % | |
| 1170 | bps |
Adjusted
EBITDA | |
$ | 40.9 | | |
$ | 36.5 | | |
$ | 4.4 | | |
| 12.1 | % | |
| 75.6 | | |
| 72.6 | | |
| 3.0 | | |
| 4.1 | % |
Adjusted
EBITDA margin | |
| 15.0 | % | |
| 13.7 | % | |
| 1.3 | % | |
| 130 | bps | |
| 13.8 | % | |
| 13.3 | % | |
| 0.5 | % | |
| 50 | bps |
Exela Technologies
Schedule 2: Reconciliation
of Adjusted EBITDA and constant currency revenues
Non-GAAP constant currency revenue reconciliation
| |
Three months ended | | |
Six months ended | |
($ in millions) | |
30-Jun-23 | | |
30-Jun-22 | | |
31-Mar-23 | | |
30-Jun-23 | | |
30-Jun-22 | |
Revenues, as reported (GAAP) | |
$ | 272.9 | | |
$ | 266.8 | | |
$ | 273.6 | | |
$ | 546.6 | | |
$ | 546.2 | |
Foreign currency exchange impact (1) | |
| 0.4 | | |
| | | |
| 3.2 | | |
| 0.4 | | |
| | |
Revenues, at constant currency (Non-GAAP) | |
$ | 273.3 | | |
$ | 266.8 | | |
$ | 276.8 | | |
$ | 547.0 | | |
$ | 546.2 | |
(1) Constant currency excludes the impact of foreign currency fluctuations and is computed by applying the average exchange rates for the three months and six months ended June 30, 2022, to the revenues during the corresponding period in 2023.
Reconciliation of Adjusted EBITDA
| |
Three months ended | | |
Six months ended | |
($ in millions) | |
30-Jun-23 | | |
30-Jun-22 | | |
31-Mar-23 | | |
30-Jun-23 | | |
30-Jun-22 | |
Net loss (GAAP) | |
$ | (30.9 | ) | |
$ | (79.2 | ) | |
$ | (45.4 | ) | |
$ | (76.3 | ) | |
$ | (136.2 | ) |
Interest expense | |
| 45.1 | | |
| 42.3 | | |
| 44.2 | | |
| 89.3 | | |
| 82.0 | |
Taxes | |
| 2.5 | | |
| 1.3 | | |
| 2.7 | | |
| 5.2 | | |
| 3.8 | |
Depreciation and amortization | |
| 14.9 | | |
| 18.0 | | |
| 16.6 | | |
| 31.4 | | |
| 36.2 | |
EBITDA (Non-GAAP) | |
$ | 31.6 | | |
$ | (17.6 | ) | |
$ | 18.0 | | |
$ | 49.6 | | |
$ | (14.1 | ) |
Transaction and integration costs | |
| 2.9 | | |
| 8.6 | | |
| 5.2 | | |
| 8.1 | | |
| 12.3 | |
Gain / loss on derivative instruments | |
| (0.0 | ) | |
| - | | |
| (0.1 | ) | |
| (0.1 | ) | |
| (0.0 | ) |
Other Charges / (gains) | |
| 0.3 | | |
| 38.9 | | |
| 5.5 | | |
| 5.7 | | |
| 61.0 | |
Sub-Total (Adj. EBITDA before O&R) | |
$ | 34.8 | | |
$ | 29.9 | | |
$ | 28.5 | | |
$ | 63.3 | | |
$ | 59.2 | |
Optimization and restructuring expenses | |
| 6.1 | | |
| 6.6 | | |
| 6.2 | | |
| 12.3 | | |
| 13.4 | |
Adjusted EBITDA (Non-GAAP) | |
$ | 40.9 | | |
$ | 36.5 | | |
$ | 34.7 | | |
$ | 75.6 | | |
$ | 72.6 | |
v3.23.2
Cover
|
Aug. 14, 2023 |
Document Information [Line Items] |
|
Document Type |
8-K
|
Amendment Flag |
false
|
Document Period End Date |
Aug. 14, 2023
|
Entity File Number |
001-36788
|
Entity Registrant Name |
EXELA TECHNOLOGIES, INC.
|
Entity Central Index Key |
0001620179
|
Entity Tax Identification Number |
47-1347291
|
Entity Incorporation, State or Country Code |
DE
|
Entity Address, Address Line One |
2701 East Grauwyler Road
|
Entity Address, City or Town |
Irving
|
Entity Address, State or Province |
TX
|
Entity Address, Postal Zip Code |
75061
|
City Area Code |
844
|
Local Phone Number |
935-2832
|
Written Communications |
false
|
Soliciting Material |
false
|
Pre-commencement Tender Offer |
false
|
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false
|
Entity Emerging Growth Company |
false
|
Common Stock [Member] |
|
Document Information [Line Items] |
|
Title of 12(b) Security |
Common stock, par value $0.0001 per share
|
Trading Symbol |
XELA
|
Security Exchange Name |
NASDAQ
|
6% Series B Cumulative Convertible Perpetual Preferred Stock, par value $0.0001 per share[Member] |
|
Document Information [Line Items] |
|
Title of 12(b) Security |
6.00% Series B Cumulative Convertible Perpetual Preferred Stock, par value $0.0001 per share
|
Trading Symbol |
XELAP
|
Security Exchange Name |
NASDAQ
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Grafico Azioni Exela Technologies (NASDAQ:XELA)
Storico
Da Apr 2024 a Mag 2024
Grafico Azioni Exela Technologies (NASDAQ:XELA)
Storico
Da Mag 2023 a Mag 2024