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Thryv Raises SaaS Revenue Guidance, Releases ThryvPay Mobile App and Reports First Quarter 2021 Financial Results

05/13/2021

SaaS Revenue Grows 17% Year-Over-Year

Strong SaaS Metrics show upward trajectory of Thryv software business

DALLAS--(BUSINESS WIRE)-- Thryv Holdings, Inc. (NASDAQ:THRY) (“Thryv” or the “Company”), the provider of Thryv® software, the end-to-end client experience platform for growing small businesses, announced financial results for the first quarter 2021. The Company has also raised its 2021 outlook for its SaaS segment.

“Our strong Q1 performance confirms we are offering the right solution for small businesses,” said Joe Walsh, CEO and president of Thryv. “As a result of our execution, we are raising our SaaS revenue guidance for 2021 and remain well-positioned to capitalize on the market opportunity.”

Today, we announced the release of our ThryvPaySM mobile app. This easy to use mobile payment app is ideally suited to the needs of service-based businesses and is now available at no monthly charge. It also offers added convenience for our Thryv platform subscribers. We are pleased to offer this app free of charge for small businesses and provide the option for frictionless upgrades to the full Thryv platform when the time is right.”

First Quarter 2021 Financial Highlights (1):

  • U.S. SaaS revenue was $37.3 million, a 17% increase year-over-year
  • U.S. Marketing Services revenue was $227.9 million
  • Thryv International Marketing Services revenue was $15.4 million
  • Consolidated total revenue was $280.6 million
  • Consolidated net income was $36.5 million
  • Consolidated adjusted EBITDA was $104.9 million, representing an adjusted EBITDA margin of 37.4%
  • Consolidated gross profit was $182.4 million
  • Consolidated adjusted gross profit was $193.8 million

(1) Consolidated results include Sensis results subsequent to the March 1, 2021 acquisition date.

Additional US Business Highlights

  • SaaS ARPU increased to $304 for the first quarter of 2021, compared to $240 in the first quarter of 2020
  • Total SaaS clients increased sequentially to 44.5 thousand for the first quarter of 2021
  • SaaS monthly churn was 2.5% for the first quarter of 2021, compared to 3.4% in the first quarter of 2020
  • Net Dollar Retention improved 16 percentage points to 89% at end of the first quarter of 2021, when compared to the first quarter of 2020
  • SaaS active users and usage frequency reached new all-time high as daily and weekly active users increased 44% year-over-year
  • SaaS average time-in-app reaches new all-time high and increases 103% year-over-year
  • On March 1st, the Company acquired Sensis Holdings, the leading Australian marketing services company

Outlook:

The Company is updating guidance for fiscal year 2021 as indicated below.

  • U.S. SaaS revenue guidance range raised to $151 – $153 million, up from the previously announced $140 - $145 million
  • U.S. Marketing Services revenue range maintained at $740 - $760 million
  • Thryv International, which reflects the acquisition of Sensis Holdings, expects revenue in the range of AUD $180 to $200 million for the 10 months of 2021 ownership (Sensis Holdings acquired March 1, 2021)

Please note: All GAAP financials now include Sensis for the month of March 2021 only.

These statements are forward-looking and actual results may materially differ. Refer to the “Forward-Looking Statements” section below for information on the factors that could cause our actual results to materially differ from these forward-looking statements.

Earnings Conference Call Information

Thryv will host a conference call on Thursday, May 13, 2021 at 8:30 a.m. (Eastern Time) to discuss the Company's first quarter 2021 results. The conference call will be available via the Internet at www.thryv.com. There will be several slides accompanying the webcast. Please go to the website at least 15 minutes prior to the call to register, download and install any necessary software. The recorded webcast will also be available on the Company's website.

If you are unable to participate in the conference call, a replay will be available. To access the replay, please dial (800) 585-8367 or (416) 621-4642 and enter "7068595."

Final Results

Thryv Holdings, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(in thousands, except share and per share data)

(unaudited)

 

 

 

Three Months Ended March 31,

 

 

2021

 

2020

Revenue

 

$

280,606

 

 

$

318,570

 

Cost of services

 

98,160

 

 

117,976

 

Gross profit

 

182,446

 

 

200,594

 

 

 

 

 

 

Operating expenses:

 

 

 

 

Sales and marketing

 

76,540

 

 

89,292

 

General and administrative

 

41,279

 

 

49,562

 

Impairment charges

 

 

 

98

 

Total operating expenses

 

117,819

 

 

138,952

 

 

 

 

 

 

Operating income

 

64,627

 

 

61,642

 

Other income (expense):

 

 

 

 

Interest expense

 

(11,607

)

 

(14,780

)

Interest expense, related party

 

(4,065

)

 

(5,150

)

Other components of net periodic pension cost

 

453

 

 

(201

)

Other expense

 

(1,093

)

 

 

Income before (provision) for income taxes

 

48,315

 

 

41,511

 

(Provision) for income taxes

 

(11,809

)

 

(13,409

)

Net income

 

$

36,506

 

 

$

28,102

 

 

 

 

 

 

Net income per common share:

 

 

 

 

Basic

 

$

1.10

 

 

$

0.86

 

Diluted

 

$

1.07

 

 

$

0.80

 

 

 

 

 

 

Weighted-average shares used in computing basic and diluted net income per common share:

 

 

 

 

Basic

 

33,108,422

 

 

32,578,286

 

Diluted

 

34,013,480

 

 

35,026,526

 

 

Thryv Holdings, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(in thousands, except share data)

(unaudited)

 

 

March 31, 2021

 

December 31, 2020

Assets

 

 

 

Current assets

 

 

 

Cash and cash equivalents

$

29,841

 

 

$

2,406

 

Accounts receivable, net of allowance of $34,557 and $33,030

354,737

 

 

296,570

 

Contract assets, net of allowance of $244 and $338

9,285

 

 

10,975

 

Taxes receivable

9,154

 

 

9,229

 

Prepaid expenses and other current assets

36,277

 

 

26,172

 

Indemnification asset

24,346

 

 

24,346

 

Total current assets

463,640

 

 

369,698

 

Fixed assets and capitalized software, net

123,281

 

 

89,044

 

Goodwill

679,559

 

 

609,457

 

Intangible assets, net

145,647

 

 

31,777

 

Deferred tax assets

97,941

 

 

93,099

 

Other assets

34,410

 

 

21,902

 

Total assets

$

1,544,478

 

 

$

1,214,977

 

Liabilities and Stockholders' Equity

 

 

 

Current liabilities

 

 

 

Accounts payable

$

19,981

 

 

$

8,927

 

Accrued liabilities

157,537

 

 

139,613

 

Current portion of unrecognized tax benefits

30,417

 

 

30,022

 

Contract liabilities

47,909

 

 

18,942

 

New Term Loan, current

70,000

 

 

 

Other current liabilities

20,324

 

 

9,896

 

Total current liabilities

346,168

 

 

207,400

 

New Term Loan, net

372,454

 

 

 

New Term Loan, related party

234,098

 

 

 

Senior Term Loan, net

 

 

335,683

 

Senior Term Loan, related party

 

 

113,482

 

ABL Facility

43,682

 

 

79,238

 

Leaseback obligations

54,585

 

 

54,798

 

Pension obligations, net

184,642

 

 

190,827

 

Deferred tax liabilities

30,706

 

 

508

 

Other liabilities

48,947

 

 

36,266

 

Total long-term liabilities

969,114

 

 

810,802

 

Commitments and contingencies

 

 

 

Stockholders' equity

 

 

 

Common stock - $0.01 par value, 250,000,000 shares authorized; 59,806,077, shares issued and 33,127,667 shares outstanding at March 31, 2021; and 59,590,422 shares issued and 32,912,012 shares outstanding at December 31, 2020

598

 

 

596

 

Additional paid-in capital

1,058,504

 

 

1,059,624

 

Treasury stock - 26,678,410 shares at March 31, 2021 and December 31, 2020

(468,613

)

 

(468,613

)

Accumulated other comprehensive income (loss)

(2,967

)

 

 

Accumulated deficit

(358,326

)

 

(394,832

)

Total stockholders' equity

229,196

 

 

196,775

 

Total liabilities and stockholders' equity

$

1,544,478

 

 

$

1,214,977

 

 

Thryv Holdings, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

 

 

Three Months Ended March 31,

 

2021

 

2020

Cash Flows from Operating Activities

 

 

 

Net income

$

36,506

 

 

$

28,102

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation and amortization

19,718

 

 

37,823

 

Amortization of debt issuance costs

433

 

 

267

 

Deferred income taxes

(13,249

)

 

(15,911

)

Provision for credit losses

2,018

 

 

10,588

 

Provision for service credits

4,528

 

 

6,736

 

Stock-based compensation expense (benefit)

1,971

 

 

(6,064

)

Other components of net periodic pension cost

(453

)

 

201

 

Loss on early extinguishment of debt

299

 

 

 

Loss on disposal/write-off of fixed assets and capitalized software

15

 

 

2,962

 

Impairment charges

 

 

98

 

Non-cash loss from remeasurement of indemnification asset

 

 

3,801

 

Gain (loss) on foreign currency exchange rates

835

 

 

 

Other, net

6

 

 

 

Changes in working capital items, excluding acquisitions:

 

 

 

Accounts receivable

26,846

 

 

(8,921

)

Contract assets

1,446

 

 

(522

)

Prepaid expenses and other assets

(10,998

)

 

(4,583

)

Accounts payable and accrued liabilities

(67,458

)

 

(33,981

)

Accrued income taxes, net

9,597

 

 

30,351

 

Operating lease liability

(403

)

 

(2,620

)

Contract liabilities

2,547

 

 

(2,685

)

Net cash provided by operating activities

14,204

 

 

45,642

 

 

 

 

 

Cash Flows from Investing Activities

 

 

 

Additions to fixed assets and capitalized software

(3,668

)

 

(9,122

)

Proceeds from the sale of building and fixed assets

 

 

1,502

 

Acquisition of a business, net of cash acquired

(174,190

)

 

 

Net cash (used in) investing activities

(177,858

)

 

(7,620

)

 

 

 

 

Cash Flows from Financing Activities

 

 

 

Proceeds from New Term Loan

418,070

 

 

 

Proceeds from New Term Loan, related party

260,930

 

 

 

Payments of Senior Term Loan

(335,821

)

 

(23,445

)

Payments of Senior Term Loan, related party

(113,789

)

 

(10,555

)

Proceeds from ABL Facility

249,936

 

 

329,719

 

Payments of ABL Facility

(285,492

)

 

(312,624

)

Purchase of treasury stock

 

 

(21,770

)

Other

(2,038

)

 

(56

)

Net cash provided by (used in) financing activities

191,796

 

 

(38,731

)

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

(707

)

 

 

Increase (decrease) in cash and cash equivalents

27,435

 

 

(709

)

Cash and cash equivalents, beginning of period

2,406

 

 

1,912

 

Cash and cash equivalents, end of period

$

29,841

 

 

$

1,203

 

 

 

 

 

Supplemental Information

 

 

 

Cash paid for interest

$

17,286

 

 

$

20,802

 

Cash paid (received) for income taxes, net

$

15,753

 

 

$

(1,031

)

 

Three Months Ended March 31, 2021

 

Marketing
Services

 

SaaS

 

Thryv
International

 

Total

Revenue

$

227,933

 

 

$

37,251

 

 

$

15,422

 

 

$

280,606

 

Segment EBITDA

98,631

 

 

316

 

 

5,986

 

 

104,933

 

Non-GAAP Measures

Our results included in this press release include Adjusted EBITDA and Adjusted Gross Profit, which are not presented in accordance with U.S. generally accepted accounting principles (“GAAP”). These non-GAAP measures are presented for supplemental informational purposes only and are not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. Please refer to the supplemental information presented in the tables below for a reconciliation of Adjusted EBITDA to Net income, and Adjusted Gross Profit to gross profit. Both Net income and Gross profit are the most comparable GAAP financial measure to Adjusted EBITDA and Adjusted Gross Profit, respectively.

We believe that these non-GAAP financial measures provide useful information about our financial performance, enhance the overall understanding of our past performance and future prospects and allow for greater transparency with respect to important metrics used by our management for financial and operational decision-making. We believe that these measures provide an additional tool for investors to use in comparing our core financial performance over multiple periods with other companies in our industry. However, it is important to note that the particular items we exclude from, or include in, our non-GAAP financial measures may differ from the items excluded from, or included in, similar non-GAAP financial measures used by other companies in the same industry.

The following is a reconciliation of Adjusted EBITDA to its most directly comparable GAAP measure, Net income (in thousands):

 

 

Three Months Ended March 31,

 

 

2021

 

2020

Reconciliation of Adjusted EBITDA

 

 

 

 

Net income

 

$

36,506

 

 

$

28,102

 

Interest expense

 

15,672

 

 

19,930

 

Provision for income taxes

 

11,809

 

 

13,409

 

Depreciation and amortization expense

 

19,718

 

 

37,823

 

Loss on early extinguishment of debt

 

299

 

 

 

Restructuring and integration expenses (1)

 

9,234

 

 

9,845

 

Transaction costs (2)

 

10,546

 

 

6,534

 

Stock-based compensation expense (benefit) (3)

 

1,971

 

 

(6,064

)

Other components of net periodic pension (benefit) cost (4)

 

(453

)

 

201

 

Non-cash loss from remeasurement of indemnification asset (5)

 

 

 

3,801

 

Impairment charges

 

 

 

98

 

Other (6)

 

(369

)

 

(900

)

Adjusted EBITDA

 

$

104,933

 

 

$

112,779

 

(1)

For the three months ended March 31, 2021 and 2020, expenses relate to periodic efforts to enhance efficiencies and reduce costs, and include severance benefits, loss on disposal of fixed assets and capitalized software, and costs associated with abandoned facilities and system consolidation.

(2)

Expenses related to the Company's direct listing, Sensis acquisition and other transaction costs.

(3)

Company records stock-based compensation expense related to the amortization of grant date fair value of the Company’s stock-based compensation awards. Additionally, stock-based compensation expense includes the remeasurement of these awards at each period end.

(4)

Other components of net periodic pension cost is from our non-contributory defined benefit pension plans that are currently frozen and incur no additional service costs. The most significant component of other components of net periodic pension cost relates to the mark to market pension remeasurement.

(5)

In connection with the YP Acquisition, the seller provided the Company indemnity for future potential losses associated with certain federal and state tax positions taken in tax returns filed by the seller prior to the Acquisition Date.

(6)

Other primarily includes expenses related to potential non income-based tax liabilities. Additionally, during the three months ended March 31, 2021, other includes foreign exchange related expense of $0.8 million.

The following is a reconciliation of Adjusted Gross Profit, to its most directly comparable GAAP measure, Gross profit (in thousands):

 

Three Months Ended March 31,

 

2021

 

2020

Reconciliation of Adjusted Gross Profit

 

 

 

Gross profit

$

182,446

 

 

$

200,594

 

Plus:

 

 

 

Depreciation and amortization expense

11,244

 

 

18,355

 

Stock-based compensation expense (benefit)

81

 

 

(316

)

Adjusted Gross Profit

$

193,771

 

 

$

218,633

 

Forward-Looking Statements

Some statements included in this release constitute forward-looking statements. Statements that include the words “may”, “will”, “could”, “should”, “would”, “believe”, “anticipate”, “forecast”, “estimate”, “expect”, “preliminary”, “intend”, “plan”, “project”, “outlook”, “future”, “forward”, “guidance” and similar statements of a future or forward-looking nature identify forward-looking statements. These statements are not guarantees of future performance. Forward-looking statements provide current expectations with respect to our financial performance and future events with respect to our business and industry in general. Forward-looking statements are based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. We believe that these factors include, but are not limited to, the risks related to the following: risks related to the ongoing COVID-19 pandemic, the Company’s ability to maintain adequate liquidity to fund operations; the Company’s future operating and financial performance; the Company’s ability to consummate acquisitions, or, if consummated, to successfully integrate acquired businesses into the Company’s operations, the Company’s ability to recognize the benefits of acquisitions, or the failure of an acquired company to achieve its plans and objectives; limitations on our operating and strategic flexibility and the ability to operate our business, finance our capital needs or expand business strategies under the terms of our credit facilities; our ability to retain existing business and obtain and retain new business; general economic or business conditions affecting the markets we serve; declining use of print yellow page directories by consumers; our ability to collect trade receivables from clients to whom we extend credit; credit risk associated with our reliance on small and medium sized businesses as clients; our ability to attract and retain key managers; increased competition in our markets; our ability to obtain future financing due to changes in the lending markets or our financial position; our ability to maintain agreements with major Internet search and local media companies; reduced advertising spending and increased contract cancellations by our clients, which causes reduced revenue; and our ability to anticipate or respond effectively to changes in technology and consumer preferences. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by such cautionary statements.

If one or more events related to these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may differ materially from what we anticipate. For these reasons, we caution you against relying on forward-looking statements. All forward-looking statements included in this press release are expressly qualified in their entirety by the foregoing cautionary statements. These forward-looking statements speak only as of the date hereof and, other than as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

About Thryv Holdings, Inc.

Thryv Holdings, Inc. owns the easy-to-use Thryv® end-to-end customer experience software built for growing small to medium sized businesses (SMBs) that helps over 40,000 SaaS clients with the daily demands of running a business. With Thryv®, SMBs can get the job, manage the job and get credit. Thryv’s award-winning platform provides modernized business functions, allowing SMBs to reach more customers, stay organized, get paid faster and generate reviews. These functions include building a digital customer database, automated marketing through email and text, updating business listings across the internet, scheduling online appointments, sending notifications and reminders, managing ratings and reviews, generating estimates and invoices, and processing payments.

Thryv supports franchise operators and multi-location business owners with Hub by Thryv™, a software console that enables businesses managers to oversee their operations using the Thryv® software.

Thryv also connects local businesses to consumer services through our search, display and social media management products, our print directories featuring The Real Yellow Pages® tagline, and our local search portals, which operate under the DexKnows.com®, Superpages.com® and Yellowpages.com URLs and reach some 35 million monthly visitors. For more information about the company, visit thryv.com.

Thryv delivers business services to more than 400,000 SMBs worldwide that enable these SMBs to compete and win in today’s economy.

On March 1, 2021, Thryv announced it closed the acquisition of Sensis, Australia’s leading digital, marketing and directory services provider, which helps Australians connect and engage through its leading platforms, digital consumer businesses (Yellow, White Pages, True Local and Whereis), search engine marketing and optimization services, website products, social, data and mapping solutions, and through its digital agency Found. Sensis is also Australia’s largest print directory publisher including the Yellow and White Pages.

Headquartered in Melbourne, Sensis has a sales presence in all states and territories across Australia.

Media Contact:
Paige Blankenship
Thryv, Inc.
972.453.3012
paige.blankenship@thryv.com

Will Clarke
Sensis
+61 (0) 488 345 464
Will.clarke@sensis.com.au

Investor Contacts:
Cameron Lessard
Thryv, Inc.
214.773.7022
cameron.lessard@thryv.com

KJ Christopher
Thryv, Inc.
972.453.7068
kj.christopher@thryv.com

Source: Thryv Holdings, Inc.

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