ETWO E2open Parent Holdings Inc

GAAP subscription revenue of $132.8 million at the high end of Q3 guidance

E2open Parent Holdings, Inc. (NYSE: ETWO) (“e2open” or the “Company”), the connected supply chain SaaS platform with the largest multi-enterprise network, today announced financial results for its fiscal third quarter ended November 30, 2023.

“In my first three months leading e2open, I have seen first-hand the unique capabilities of our product offering and the significant value that our solutions are delivering for some of the world’s largest and best-known companies,” said Andrew Appel, e2open’s interim chief executive officer. “Although our revenue growth has been below our potential, we are intently focused on returning to sustainable growth by implementing specific action plans to improve sales execution, deepen client engagement, and deliver flawless implementations. While this change process will take several quarters to materially impact our top line, our teams are excited by the client-centric approach, the early signs of progress we saw during the fiscal third quarter, and the tremendous opportunity we have in front of us to create value for our clients and shareholders.”

“In the third fiscal quarter, e2open delivered subscription revenue near the high end of our guidance and maintained strong adjusted EBITDA margins,” said Marje Armstrong, chief financial officer of e2open. “We exited the quarter with better sales execution in both subscription and professional services as evidenced by large deal closings with major new and existing clients across a range of industry sectors. Although we still have work to do to transform our go-to-market and client engagement model, and conditions in some end-markets remain uncertain, our improved third quarter execution gives us confidence in the steps we are taking to re-accelerate e2open’s growth.”

Fiscal Third Quarter 2024 Financial Highlights

• Revenue
  • GAAP subscription revenue for the third quarter of 2024 was $132.8 million, a decrease of 1.5% from the year-ago comparable period and 84.3% of total revenue. Subscription revenue decreased 2.2% on a constant currency basis.
  • Total GAAP revenue for the third quarter of 2024 was $157.5 million, a decrease of 4.5% from the year-ago comparable period. Total revenue decreased 5.2% on a constant currency basis.

• GAAP gross profit for the third quarter of 2024 was $78.6 million, a decrease of 6.6% from the year-ago comparable period. Non-GAAP gross profit was $109.7 million, down 3.4% and 4.0% on a constant currency basis.

• GAAP gross margin for the third quarter of 2024 was 49.9% compared to 51.0% from the year-ago comparable period. Non-GAAP gross margin was 69.6% on an organic basis and 69.7% on a constant currency basis compared to 68.9% from the comparable year-ago period.

• GAAP Net loss for the third quarter of 2024 was $740.0 million compared to a net income of $5.5 million from the year-ago comparable period. Adjusted EBITDA for the third quarter of 2024 was $55.4 million, a decrease of 1.4% and 1.5% on a constant currency basis from the year-ago comparable period. Adjusted EBITDA margin was 35.1% and 35.4% on a constant currency basis versus 34.1% from the comparable year-ago period.

• GAAP EPS for the third quarter of 2024 was a loss of $2.20. Adjusted EPS for the third quarter of 2024 was $0.04.

• Cash flow
  • GAAP operating cash flow on a year-to-date basis was $56.7 million compared to $43.2 million from the year-ago comparable period, inclusive of non-recurring expenses.
  • Adjusted operating cash flow on a year-to-date basis, exclusive of non-recurring expenses, was $79.0 million, which represents 47.8% of year-to-date adjusted EBITDA.

Recent Business Highlights

• Selected by Scan Global Logistics (SGL) to optimize the global freight forwarder’s operations across multiple modes of transportation and an expansive geography in what the client called “the single largest and most important IT project in SGL’s history.” The multi-year agreement helps SGL reduce freight and operational costs, increase transportation efficiency, and enhance its end-user and customer experience.

• Closed new logo business including one of the world’s largest commercial vehicle manufacturers that selected e2open’s global screening solution to reduce compliance risk for over 2.5 million partners; and an international designer and manufacturer of sustainable plastic packaging that chose e2open’s Transportation Management and Logistics as a Service to optimize its logistics operations and realize transportation cost savings.

• Implemented a large project with NORTERA, a leading North American food manufacturer of canned and frozen fruits and vegetables. With e2open’s Transportation Management, positioned as a Leader by Gartner, NORTERA gains network visibility, automated invoicing processes, and world-class transportation execution and reporting to increase efficiency, reduce freight costs, and improve service levels.

• Expanded business with existing major clients across a variety of industry sectors. These large cross-sell wins included a Fortune 500 multinational conglomerate that has been an e2open client since 2015, and a leading provider of enterprise software, each of which selected e2open for its proven ability to deliver a comprehensive and scalable Channel Data Management solution for complex partner ecosystems.

• Implemented a new project with existing client Vertiv, a global leader in critical digital infrastructure technologies. The project brought synergies around reusing the common master data and established a single feed across all applications, an example of e2open's connected supply chain capabilities. This implementation has contributed to lower partner management costs and a better user experience for Vertiv.

• Presented annual client awards at Connect 2023 conference, recognizing customers who have achieved remarkable results in supply chain and channel innovation utilizing e2open solutions. Award winners were Vertiv, QSC, Tapestry, Inc., Ball Corporation, and High Liner Foods.

Financial Outlook for Fiscal Year 2024

As of January 9, 2024, e2open is updating full year 2024 guidance previously provided on October 10, 2023, and providing fourth quarter 2024 guidance as follows:

Fiscal 2024 Subscription GAAP Revenue

• GAAP subscription revenue for fiscal 2024 is expected to be in the range of $533 million to $536 million (versus prior guidance of $530 million to $538 million), reflecting a 0.3% organic growth rate at the mid-point.

Fiscal 2024 Total GAAP Revenue

• Total GAAP revenue for fiscal 2024 is expected to be in the range of $628 million to $633 million (versus prior guidance of $625 million to $635 million), reflecting a 3.3% year-over-year decrease at the mid-point.

Fiscal Fourth Quarter 2024 GAAP Subscription Revenue

• GAAP subscription revenue for the fiscal fourth quarter of 2024 is expected to be in the range of $131 million to $134 million, reflecting a 3.2% year-over-year decrease at the mid-point.

Fiscal 2024 Non-GAAP Gross Profit Margin

• Non-GAAP gross profit margin for fiscal 2024 is still expected to be in the range of 68% to 70%.

Fiscal 2024 Adjusted EBITDA

• Adjusted EBITDA for fiscal 2024 is still expected to be in the range of $215 million to $220 million, reflecting an implied adjusted EBITDA margin in the range of 34% to 35%.

NOTE: E2open is unable to quantify certain amounts that would be required to be included in the most directly comparable GAAP financial measures for non-GAAP gross profit margin or adjusted EBITDA without unreasonable effort, and therefore no reconciliation of certain forward-looking non-GAAP financial measures for non-GAAP gross profit margin or adjusted EBITDA is included.

Quarterly Conference Call

E2open will host a conference call today at 5:00 p.m. ET to review fiscal third quarter 2024 financial results, in addition to discussing the Company’s outlook for the full fiscal year 2024. To access this call, dial 888-506-0062 (domestic) or 973-528-0011 (international). The conference ID is 740053. A live webcast of the conference call will be accessible in the “Investor Relations” section of e2open’s website at www.e2open.com. A replay of this conference call can also be accessed through January 23, 2024, at 877-481-4010 (domestic) or 919-882-2331 (international). The replay passcode is 49575. An archived webcast of this conference call will also be available after the completion of the call in the “Investor Relations” section of the Company’s website at www.e2open.com.

About e2open

E2open is the connected supply chain software platform that enables the world’s largest companies to transform the way they make, move, and sell goods and services. With the broadest cloud-native global platform purpose-built for modern supply chains, e2open connects more than 480,000 manufacturing, logistics, channel, and distribution partners as one multi-enterprise network tracking over 15 billion transactions annually. Our SaaS platform anticipates disruptions and opportunities to help companies improve efficiency, reduce waste, and operate sustainably. Moving as one.™ Learn More: www.e2open.com.

E2open and “Moving as one.” are the registered trademarks of E2open, LLC. All other trademarks, registered trademarks and service marks are the property of their respective owners.

Non-GAAP Financial Measures

This press release includes certain financial measures not presented in accordance with generally accepted accounting principles (“GAAP”) including non-GAAP revenue, non-GAAP subscription revenue, non-GAAP professional services and other revenue, adjusted EBITDA, adjusted EBITDA margin, non-GAAP gross profit, non-GAAP net income, non-GAAP gross margin, adjusted free cash flow and adjusted earnings per share. These non-GAAP financial measures are not a measure of financial performance in accordance with GAAP and may exclude items that are significant in understanding and assessing the Company’s financial results. Therefore, these measures should not be considered in isolation or as an alternative to net income, cash flows from operations or other measures of profitability, liquidity, or performance under GAAP. You should be aware that the Company’s presentation of these measures may not be comparable to similarly titled measures used by other companies.

The Company believes this non-GAAP measure of financial results provides useful information to management and investors regarding certain financial and business trends relating to the Company’s financial condition and results of operations. The Company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends in comparing the Company’s financial measures with other similar companies, many of which present similar non-GAAP financial measures to investors. These non-GAAP financial measures are subject to inherent limitations as they reflect the exercise of judgments by management about which expense and income are excluded or included in determining these non-GAAP financial measures.

Safe Harbor Statement

Certain statements in this press release are "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created thereby. These statements relate to future events or the Company's future financial performance and involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the Company or its industry to be materially different from those expressed or implied by any forward-looking statements. In particular, statements about the Company's expectations, beliefs, plans, objectives, assumptions, future events or future performance contained in this press release are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as "may," "will," "could," "would," "should," "expect," "plan," "anticipate," "intend," "believe," "estimate," "predict," "potential," "outlook," "guidance" or the negative of those terms or other comparable terminology.

Please see the Company's documents filed or to be filed with the Securities and Exchange Commission, including the annual report filed on Form 10-K, and any amendments thereto for a discussion of certain important risk factors that relate to forward-looking statements contained in this press release. The Company has based these forward-looking statements on its current expectations, assumptions, estimates and projections. While the Company believes these expectations, assumptions, estimates, and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond the Company's control. These and other important factors may cause actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Any forward-looking statements are made only as of the date hereof, and unless otherwise required by applicable securities laws, the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

E2OPEN PARENT HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

Three Months Ended November 30,

(In thousands, except per share amounts)

 

2023

 

 

2022

 

Revenue

Subscriptions

$

132,800

 

$

134,884

 

Professional services and other

 

24,697

 

 

30,009

 

Total revenue

 

157,497

 

 

164,893

 

Cost of Revenue

Subscriptions

 

36,689

 

 

35,931

 

Professional services and other

 

17,642

 

 

20,417

 

Amortization of acquired intangible assets

 

24,590

 

 

24,402

 

Total cost of revenue

 

78,921

 

 

80,750

 

Gross Profit

 

78,576

 

 

84,143

 

Operating Expenses

Research and development

 

24,937

 

 

24,939

 

Sales and marketing

 

22,583

 

 

20,448

 

General and administrative

 

24,739

 

 

23,073

 

Acquisition-related expenses

 

9

 

 

1,969

 

Amortization of acquired intangible assets

 

20,014

 

 

19,965

 

Goodwill impairment

 

687,700

 

 

—

 

Intangible asset impairment

 

30,000

 

 

—

 

Total operating expenses

 

809,982

 

 

90,394

 

Loss from operations

 

(731,406

)

 

(6,251

)

Other income (expense)

Interest and other expense, net

 

(24,643

)

 

(21,270

)

Gain from change in tax receivable agreement liability

 

2,888

 

 

2,697

 

Gain from change in fair value of warrant liability

 

2,617

 

 

16,150

 

Gain from change in fair value of contingent consideration

 

5,100

 

 

6,300

 

Total other (expense) income

 

(14,038

)

 

3,877

 

Loss before income tax provision

 

(745,444

)

 

(2,374

)

Income tax benefit

 

5,413

 

 

7,877

 

Net (loss) income

 

(740,031

)

 

5,503

 

Less: Net (loss) income attributable to noncontrolling interest

 

(72,475

)

 

698

 

Net (loss) income attributable to E2open Parent Holdings, Inc.

$

(667,556

)

$

4,805

 

 

Weighted-average common shares outstanding:

Basic

 

303,848

 

 

302,201

 

Diluted

 

303,848

 

 

302,359

 

Net (loss) income attributable to E2open Parent Holdings, Inc. common shareholders per share:

Basic

$

(2.20

)

$

0.02

 

Diluted

$

(2.20

)

$

0.02

 

E2OPEN PARENT HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

(In thousands)

November 30, 2023

February 28, 2023

Assets

Cash and cash equivalents

$

110,279

 

$

93,032

 

Restricted cash

 

19,659

 

 

11,310

 

Accounts receivable, net

 

127,330

 

 

174,809

 

Prepaid expenses and other current assets

 

30,483

 

 

25,200

 

Total current assets

 

287,751

 

 

304,351

 

Goodwill

 

1,846,263

 

 

2,927,807

 

Intangible assets, net

 

886,315

 

 

1,051,124

 

Property and equipment, net

 

70,024

 

 

72,476

 

Operating lease right-of-use assets

 

21,580

 

 

18,758

 

Other noncurrent assets

 

28,559

 

 

25,659

 

Total assets

$

3,140,492

 

$

4,400,175

 

Liabilities and Stockholders' Equity

Accounts payable and accrued liabilities

$

83,196

 

$

97,491

 

Channel client deposits payable

 

19,659

 

 

11,310

 

Deferred revenue

 

176,253

 

 

203,824

 

Current portion of notes payable

 

11,122

 

 

11,144

 

Current portion of operating lease obligations

 

7,317

 

 

7,622

 

Current portion of financing lease obligations

 

1,120

 

 

2,582

 

Income taxes payable

 

1,721

 

 

2,190

 

Total current liabilities

 

300,388

 

 

336,163

 

Long-term deferred revenue

 

2,833

 

 

2,507

 

Operating lease obligations

 

17,959

 

 

15,379

 

Financing lease obligations

 

3,188

 

 

1,049

 

Notes payable

 

1,038,908

 

 

1,043,636

 

Tax receivable agreement liability

 

59,663

 

 

69,745

 

Warrant liability

 

10,830

 

 

29,616

 

Contingent consideration

 

14,188

 

 

29,548

 

Deferred taxes

 

66,038

 

 

144,529

 

Other noncurrent liabilities

 

721

 

 

1,083

 

Total liabilities

 

1,514,716

 

 

1,673,255

 

Commitments and Contingencies

Stockholders' Equity

Class A common stock

 

30

 

 

30

 

Class V common stock

 

—

 

 

—

 

Series B-1 common stock

 

—

 

 

—

 

Series B-2 common stock

 

—

 

 

—

 

Additional paid-in capital

 

3,395,158

 

 

3,378,633

 

Accumulated other comprehensive loss

 

(45,892

)

 

(68,603

)

Accumulated deficit

 

(1,831,502

)

 

(803,679

)

Treasury stock, at cost

 

(2,473

)

 

(2,473

)

Total E2open Parent Holdings, Inc. equity

 

1,515,321

 

 

2,503,908

 

Noncontrolling interest

 

110,455

 

 

223,012

 

Total stockholders' equity

 

1,625,776

 

 

2,726,920

Total liabilities and stockholders' equity

$

3,140,492

 

$

4,400,175

E2OPEN PARENT HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

Nine Months Ended November 30,

(In thousands)

2023

 

2022

Cash flows from operating activities

Net loss

$

(1,139,544

)

$

(416,703

)

Adjustments to reconcile net loss to net cash from operating activities:

Depreciation and amortization

 

160,758

 

 

159,831

 

Amortization of deferred commissions

 

4,452

 

 

2,878

 

Provision for credit losses

 

2,657

 

 

315

 

Amortization of debt issuance costs

 

3,961

 

 

3,783

 

Amortization of operating lease right-of-use assets

 

5,454

 

 

5,813

 

Share-based compensation

 

18,728

 

 

13,139

 

Deferred income taxes

 

(79,791

)

 

(143,012

)

Right-of-use assets impairment charge

 

619

 

 

4,137

 

Goodwill impairment charge

 

1,097,741

 

 

514,816

 

Indefinite-lived intangible asset impairment charge

 

34,000

 

 

—

 

Gain from change in tax receivable agreement liability

 

(8,355

)

 

(9,089

)

Gain from change in fair value of warrant liability

 

(18,786

)

 

(36,764

)

Gain from change in fair value of contingent consideration

 

(15,360

)

 

(17,760

)

Gain on operating lease termination

 

(187

)

 

—

 

(Gain) loss on disposal of property and equipment

 

(16

)

 

537

 

Changes in operating assets and liabilities:

Accounts receivable

 

44,822

 

 

10,876

 

Prepaid expenses and other current assets

 

(3,972

)

 

4,311

 

Other noncurrent assets

 

(7,351

)

 

(4,094

)

Accounts payable and accrued liabilities

 

(16,712

)

 

(12,946

)

Channel client deposits payable

 

8,349

 

 

(5,943

)

Deferred revenue

 

(27,244

)

 

(26,899

)

Changes in other liabilities

 

(7,568

)

 

(4,075

)

Net cash provided by operating activities

 

56,655

 

 

43,151

 

Cash flows from investing activities

Payments for acquisitions - net of cash acquired

 

—

 

 

(179,243

)

Capital expenditures

 

(22,301

)

 

(40,473

)

Minority investment in private firm

 

—

 

 

(3,000

)

Net cash used in investing activities

 

(22,301

)

 

(222,716

)

Cash flows from financing activities

Proceeds from indebtedness

 

—

 

 

215,000

 

Repayments of indebtedness

 

(8,366

)

 

(103,174

)

Repayments of financing lease obligations

 

(2,432

)

 

(2,312

)

Repurchase of common units

 

—

 

 

(1,397

)

Payments of debt issuance costs

 

—

 

 

(4,766

)

Net cash (used in) provided by financing activities

 

(10,798

)

 

103,351

 

Effect of exchange rate changes on cash and cash equivalents

 

2,040

 

 

478

 

Net increase (decrease) in cash, cash equivalents and restricted cash

 

25,596

 

 

(75,736

)

Cash, cash equivalents and restricted cash at beginning of period

 

104,342

 

 

174,554

 

Cash, cash equivalents and restricted cash at end of period

$

129,938

 

$

98,818

 

E2OPEN PARENT HOLDINGS, INC.

RECONCILIATION OF PRO FORMA INFORMATION

TABLE I

Fiscal Third Quarter 2024

(in millions)

Q3

Q3

$ Var

% Var

FY2024

FY2023

PRO FORMA REVENUE RECONCILIATION

 

 

 

 

Total GAAP Revenue

157.5

164.9

(7.4)

(4.5%)

Constant currency FX impact (1)

(1.1)

-

(1.1)

n/m

Total non-GAAP revenue (constant currency basis) (2)

$156.4

$164.9

($8.5)

(5.2%)

 

 

 

 

GAAP Subscription Revenue

132.8

134.9

(2.1)

(1.5%)

Constant currency FX impact (1)

(0.8)

-

(0.8)

n/m

Non-GAAP subscription revenue (constant currency basis) (2)

$132.0

$134.9

($2.9)

(2.2%)

 

 

 

 

GAAP Professional Services and other revenue

24.7

30.0

(5.3)

(17.7%)

Constant currency FX impact (1)

(0.3)

-

(0.3)

n/m

Non-GAAP professional services and other revenue (constant currency basis) (2)

$24.4

$30.0

($5.6)

(18.6%)

 

 

 

 

PRO FORMA GROSS PROFIT RECONCILIATION

 

 

 

 

GAAP Gross profit

78.6

84.1

(5.6)

(6.6%)

Depreciation and amortization

28.7

28.4

0.3

1.0%

Share-based compensation (3)

1.3

0.5

0.8

142.6%

Non-recurring/non-operating costs (4)

1.1

0.5

0.6

115.7%

Non-GAAP gross profit

$109.7

$113.6

($3.9)

(3.4%)

Non-GAAP Gross Margin %

69.6%

68.9%

 

 

Constant currency FX impact (1)

(0.6)

-

(0.6)

n/m

Total non-GAAP gross profit (constant currency basis) (2)

$109.1

$113.6

($4.5)

(4.0%)

Non-GAAP Gross Margin % (constant currency basis) (2)

69.7%

68.9%

 

 

 

 

 

 

PRO FORMA ADJUSTED EBITDA RECONCILIATION

 

 

 

 

Net income (loss)

(740.0)

5.5

(745.5)

n/m

Interest expense, net

24.9

19.5

5.4

27.8%

Income tax benefit

(5.4)

(7.9)

2.5

(31.3%)

Depreciation and amortization

53.6

52.5

1.1

2.2%

EBITDA

($666.9)

$69.6

($736.5)

n/m

Share-based compensation (3)

6.8

4.8

2.0

42.5%

Non-recurring/non-operating costs (4)

8.3

3.2

5.1

158.6%

Acquisition-related adjustments (5)

0.0

2.0

(2.0)

(99.5%)

Change in tax receivable agreement liability (6)

(2.9)

(2.7)

(0.2)

7.0%

Change in fair value of warrant liability (7)

(2.6)

(16.2)

13.5

(83.8%)

Change in fair value of contingent consideration (8)

(5.1)

(6.3)

1.2

(19.0%)

Goodwill impairment

687.7

0.0

687.7

n/m

Right-of-use assets & Intangible impairment charge

30.1

1.8

28.3

1,608.5%

Adjusted EBITDA

$55.4

$56.2

($0.8)

(1.4%)

Adjusted EBITDA Margin %

35.1%

34.1%

 

 

Constant currency FX impact (1)

(0.0)

-

(0.0)

n/m

Total adjusted EBITDA (constant currency basis) (2)

$55.3

$56.2

($0.8)

(1.5%)

Adjusted EBITDA Margin % (constant currency basis) (2)

35.4%

34.1%

 

 

(1) Constant Currency refers to pro-forma amounts excluding the impact of translating foreign currencies into U.S. dollars. To calculate foreign currency translation on a constant currency basis, operating results for the current year period for entities reporting in currencies other than the U.S. dollar are translated into U.S. dollars at the exchange rates in effect during the comparable period of the prior year (rather than the actual exchange rates in effect during the current year period)

(2) Constant Currency refers to pro forma amounts excluding translation and transactional impacts from foreign currency exchange rates.

(3) Reflects non-cash, long-term share-based compensation expense.

(4) Primarily includes other non-recurring expenses such as systems integrations and consulting, advisory fees and certain severance costs.

(5) Primarily includes advisory, consulting, accounting and legal expenses incurred in connection with mergers and acquisitions activity, including related valuation, negotiation and integration costs and capital-raising activities for costs related to the BluJay and Logistyx acquisitions.

(6) Represents the expense related to the change in the fair value of the tax receivable agreement liability, including interest.

(7) Represents the fair value adjustment at each balance sheet date of the warrant liability related to the public, private placement, and forward purchase warrants.

(8) Represents the fair value adjustment at each balance sheet date of the contingent consideration liability related to the restricted Series B-2 common stock and Series 2 RCUs.

E2OPEN PARENT HOLDINGS, INC.

RECONCILIATION OF NON-GAAP EXPENSES

TABLE II

Fiscal Third Quarter 2024

 

 

 

 

 

 

 

(in millions)

GAAP

Non-recurring(1)

Impairment Charges(2)

Depreciation & Amortization

Share-Based Compensation

Non-GAAP (Adjusted)

% of Revenue

COST OF GOODS

 

 

 

 

 

 

 

Subscriptions

36.7

(0.3)

-

(3.9)

(0.7)

31.7

23.9%

Professional services and other

17.6

(0.8)

-

(0.2)

(0.6)

16.1

65.3%

Amortization of intangibles

24.6

-

-

(24.6)

-

-

 

Total cost of revenue

$78.9

($1.1)

-

($28.7)

($1.3)

$47.8

30.4%

 

 

 

 

 

 

 

 

Gross Profit

$78.6

$1.1

-

$28.7

$1.3

$109.7

69.6%

 

 

 

 

 

 

 

 

OPERATING COSTS

 

 

 

 

 

 

 

Research & development

24.9

(0.3)

-

(4.2)

(1.7)

18.8

11.9%

Sales & marketing

22.6

(0.3)

-

(0.3)

(1.6)

20.4

12.9%

General & administrative

24.7

(6.8)

(0.1)

(0.4)

(2.3)

15.1

9.6%

Acquisition related expenses

0.0

(0.0)

-

-

-

-

 

Amortization of intangibles

20.0

-

-

(20.0)

-

-

 

Intangible impairment

30.0

-

(30.0)

-

-

-

 

Goodwill impairment

687.7

-

(687.7)

-

-

-

 

Total operating expenses

$810.0

($7.5)

($717.8)

($24.9)

($5.5)

$54.3

34.5%

(1) Primarily includes other non-recurring expenses such as systems integrations and consulting, advisory fees, and certain severance costs.

(2) The company recognized a right-of-use asset impairment charge of $0.1M in G&A, Intangible impairment of $30.0M and $687.7M Goodwill impairment in Q3 FY24.

E2OPEN PARENT HOLDINGS, INC.

RECONCILIATION OF ADJUSTED EARNINGS PER SHARE

TABLE III

Fiscal Third Quarter 2024

 

(in millions, except per share amounts)

Q3 24

GAAP Net loss

(740.0)

Interest expense, net

24.9

Income taxes benefit

(5.4)

Depreciation & amortization

53.6

EBITDA

($666.9)

Share-based compensation

6.8

Non-recurring/non-operating costs

8.3

Acquisition-related adjustments

0.0

Change in tax receivable agreement liability

(2.9)

Change in fair value of warrant liability

(2.6)

Change in fair value of contingent consideration

(5.1)

Goodwill impairment

687.7

Right-of-use assets & Intangible impairment charge

30.1

Adjusted EBITDA

$55.4

Depreciation

(9.0)

Interest and other expense, net

(24.9)

Adjusted EBIT

$21.4

Normalized income taxes (1)

(5.1)

Adjusted Net Income

$16.3

Adjusted basic shares outstanding

388.0

Adjusted earnings per share

$0.04

 

(1) Income taxes calculated using 24% effective rate.

E2OPEN PARENT HOLDINGS, INC.

ADJUSTED FREE CASH FLOW

TABLE IV

 

Fiscal Third Quarter 2024

(in millions)

Q1 24

Q2 24

Q3 24

Q3 YTD

GAAP operating cash flow

36.5

14.8

5.4

56.7

 

 

 

 

Add: Non-recurring cash payments (1)

3.4

1.9

25.5

30.7

Add: Change in channel client deposits payable (2)

(2.5)

(8.9)

3.1

(8.3)

Adjusted operating cash flow

$37.3

$7.7

$34.0

$79.0

 

 

 

 

Capital expenditures

(6.6)

(9.5)

(6.2)

(22.3)

Adjusted free cash flow

$30.8

($1.8)

$27.7

$56.7

(1) Primarily includes cash payment of a $17.8 million legal settlement for the previously disclosed unfavorable arbitration ruling related to a 2014 contract between Kewill (a predecessor of BluJay), as well as other non-recurring costs.

(2) Channel Client Deposits Payable represents client deposits for the incentive payment program associated with the Company's channel shaping application. The Company offers services to administer incentive payments to partners on behalf of the Company’s clients. The Company’s clients deposit these funds into a restricted cash account with an offset included as a liability in incentive program payable in the Consolidated Balance Sheets

E2OPEN PARENT HOLDINGS, INC.

CONSOLIDATED CAPITAL

TABLE V

Fiscal Third Quarter 2024

 

Description

Shares (000's)

Notes

Shares outstanding as of November 30, 2023

304,388

 

Shares outstanding

Common Units

32,723

Units issued in the Business Combination that have not been converted from common units to Class A common stock (Common units are represented by Class V shares).

Series B-2 Shares (unvested)

3,372

 

Represents the right to acquire shares of Class A common stock when the 20-day VWAP reaches $15.00 per share.

Restricted Common Units Series 2 (unvested)

2,628

Represents the right in E2open Holdings, LLC that converts into common units when the 20-day VWAP reaches $15.00. Upon conversion to common units, the holders can elect to convert the common units to Class A common stock.

Adjusted Basic Shares

343,111

 

 

 

Warrants

29,080

 

Outstanding warrants with an exercise price of $11.50.

Options (vested/unreleased and unvested)

2,116

Options issued to management under the long-term incentive plan.

Restricted Shares (vested/unreleased and unvested)

13,702

 

Restricted shares issued to employees, management and directors under the long-term incentive plan.

Fully Converted Shares

388,009

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240109204369/en/

Investor Contact Dusty Buell dusty.buell@e2open.com investor.relations@e2open.com

Media Contact 5W PR for e2open e2open@5wpr.com 718-757-6144

Corporate Contact Kristin Seigworth VP Communications, e2open kristin.seigworth@e2open.com pr@e2open.com