ATLANTA, July 12, 2021 /PRNewswire/ -- KORE, a global
leader in Internet of Things ("IoT") solutions and worldwide IoT
Connectivity-as-a-Service ("IoT CaaS"), today reported financial
and operational results for the first quarter ended March 31, 2021. Strong performance positions the
company to exceed its FY 2021 expectations. The company will look
to revise higher its 2021 forecast after announcing results for the
quarter ended June 30, 2021 and
completing the targeted NYSE listing process.
"By outperforming first quarter expectations across the board, KORE
is now set up to exceed expectations for FY 2021."
First Quarter 2021 Financial Highlights
- Total revenue increased 11% year-over-year to $55.3 million, a record in first quarter revenue
performance.
- Revenue generated in the Connected Health industry sector
increased 25% to $20 million,
compared to $16 million in the same
prior-year period.
- IoT Connectivity revenue increased 6% to $40.7 million, compared to $38.4 million in the same prior-year period.
- IoT Solutions revenue increased 26% to $14.6 million, compared to $11.6 million in the same prior-year period.
- Adjusted EBITDA, a non-GAAP metric*, increased 20% to
$16.4 million, compared to
$13.7 million in the same prior-year
period.
|
Three Months
Ended
March
31,
|
Year
Ended
December
31,
|
|
2021
|
2020
|
2020
|
2019
|
IoT
Connectivity
|
$
40,720
|
74%
|
$
38,398
|
77%
|
$
158,748
|
74%
|
$
150,358
|
89%
|
IoT
Solutions
|
14,577
|
26%
|
11,580
|
23%
|
55,012
|
26%
|
18,794
|
11%
|
Total
Revenues
|
$55,297
|
100%
|
$49,978
|
100%
|
$
213,760
|
100%
|
$169,152
|
100%
|
|
|
|
Period End
Customer
Connections Count
|
12.9
million
|
10.0
million
|
11.8
million
|
|
9.7
million
|
Average
Customer
Connections Count for
the Period
|
12.7
million
|
9.9
million
|
10.7
million
|
9.2
million
|
|
*See Appendix for reconciliation
"Our robust first quarter results demonstrate successful
execution of KORE's transformation into the recognizable leader in
the enablement of IoT solutions, globally," said KORE President and
CEO Romil Bahl. "Our Connected
Health sector, the largest of five industry verticals we are
focused on, saw a double-digit increase year-over-year, making that
sector a key driver of top line performance in the first quarter.
By outperforming first quarter expectations across the board, KORE
is now set up to exceed expectations for FY 2021. We remain
steadfast helping new and existing customers deploy, manage, and
scale their IoT applications, ultimately driving sustained growth
and value for all stakeholders."
Key Metrics and Recent Business Highlights
- Total customer connections increased to 12.9 million as of
March 31, 2021, up from 10 million
total connections as of March 31,
2020.
- Secured commitment from largest Connected Health customer to
increase business volumes, as KORE assists in its transition to LTE
from 2G and 3G.
- Dollar-Based Net Expansion Rate (DBNER) was 108% for the twelve
months ended March 31, 2021, compared
to 107% in the twelve months ended March 31,
2020.
- Revenue mix - IoT Connectivity to IoT Solutions - changed from
77:23 in Q1, 2020 to 74:26 in Q1, 2021, reflecting continued
accelerated growth of IoT Solutions.
- Provided IoT connectivity services to ~3,600 customers globally
for the three months ended March 31,
2021, most of which are connectivity only, representing a
healthy installed base of customers to cross-sell additional
services.
See the Appendix for definitions of Total Customer Connections
and DBNER.
About KORE
KORE is a pioneer, leader, and trusted advisor delivering
mission-critical IoT solutions and services. We empower
organizations of all sizes to improve operational and business
results by simplifying the complexity of IoT. Our deep IoT
knowledge and experience, global reach, purpose-built solutions,
and deployment agility accelerate and materially impact our
customers' business outcomes. For more information,
visit korewireless.com.
Contacts
KORE
Media and Investors:
Jean Creech Avent
Vice President, Investor Relations and Public Relations
jcreechavent@korewireless.com
+1-843-986-8229
Investors
investors@korewireless.com
Or
Investors:
Matt Glover and Cody Slach
Gateway Group, Inc.
KORE@gatewayir.com
+1-949-574-3860
Important Information and Where to Find It
This press release references the proposed merger transaction
announced previously involving Cerberus Telecom Acquisition Corp.
("CTAC") and KORE. CTAC and King Pubco, Inc. ("Pubco") filed a
registration statement on Form S-4 with the SEC, which includes a
proxy statement of CTAC and a prospectus of Pubco, and CTAC will
file other documents regarding the proposed transaction with the
SEC. A definitive proxy statement/prospectus will also be sent to
the stockholders of CTAC, seeking required stockholder approval.
Before making any voting or investment decision, investors and
security holders of CTAC are urged to carefully read the entire
registration statement and proxy statement/prospectus, when they
become available, and any other relevant documents filed with the
SEC, as well as any amendments or supplements to these documents,
because they will contain important information about the proposed
transaction. The documents filed by CTAC with the SEC may be
obtained free of charge at the SEC's website at www.sec.gov. In
addition, the documents filed by CTAC with the SEC may be obtained
free of charge from CTAC's website at www.cerberusacquisition.com
or upon written request to Cerberus Telecom Acquisition Corp., 875
Third Avenue, New York, NY
10022.
This press release, similar to the previous announcement, does
not constitute an offer to sell or the solicitation of an offer to
buy any securities or a solicitation of any vote or approval, nor
shall there be any sale of any securities in any state or
jurisdiction in which such offer, solicitation, or sale would be
unlawful prior to registration or qualification under the
securities laws of such other jurisdiction.
CTAC, KORE and certain of their respective directors and
executive officers may be deemed to be participants in the
solicitation of proxies from the stockholders of CTAC, in favor of
the approval of the merger. Information regarding CTAC's and KORE's
directors and executive officers and other persons who may be
deemed participants in the transaction may be obtained by reading
the registration statement and the proxy statement/prospectus and
other relevant documents filed with the SEC when they become
available. Free copies of these documents may be obtained as
described above.
Forward-Looking Statements
This press release includes certain statements that are not
historical facts but are forward-looking statements for purposes of
the safe harbor provisions under the United States Private
Securities Litigation Reform Act of 1995. Forward-looking
statements generally are accompanied by words such as "believe,"
"may," "will," "estimate," "continue," "anticipate," "intend,"
"expect," "should," "would," "plan," "predict," "potential,"
"seem," "seek," "future," "outlook," and similar expressions that
predict or indicate future events or trends or that are not
statements of historical matters. These forward-looking statements
include, but are not limited to, statements regarding estimates and
forecasts of revenue and other financial and performance metrics
and projections of market opportunity and expectations. These
statements are based on various assumptions and on the current
expectations of CTAC or KORE's management. These forward-looking
statements are provided for illustrative purposes only and are not
intended to serve as, and must not be relied on by any investor or
other person as, a guarantee, an assurance, a prediction or a
definitive statement of fact or probability. Actual events and
circumstances are difficult or impossible to predict and will
differ from assumptions. Many actual events and circumstances are
beyond the control of CTAC and/or KORE. These forward-looking
statements are subject to a number of risks and uncertainties,
including general economic, financial, legal, political and
business conditions and changes in domestic and foreign markets;
the potential effects of COVID-19; risks related to the rollout of
KORE's business and the timing of expected business milestones;
changes in the assumptions underlying KORE's expectations regarding
its future business; the effects of competition on KORE's future
business; and the outcome of judicial proceedings to which KORE is,
or may become a party. If the risks materialize or assumptions
prove incorrect, actual results could differ materially from the
results implied by these forward-looking statements. There may be
additional risks that KORE presently does not know or that KORE
currently believes are immaterial that could also cause actual
results to differ materially from those contained in the
forward-looking statements. In addition, forward-looking statements
reflect KORE's expectations, plans or forecasts of future events
and views as of the date of this press release. KORE and CTAC
anticipate that subsequent events and developments will cause these
assessments to change. However, while KORE and/or CTAC may elect to
update these forward-looking statements at some point in the
future, each of KORE and CTAC specifically disclaims any obligation
to do so. These forward-looking statements should not be relied
upon as representing KORE's assessments as of any date subsequent
to the date of this press release. Accordingly, undue reliance
should not be placed upon the forward-looking statements.
Appendix
Non-GAAP Financial Measures
In addition to our results determined in accordance with GAAP,
we believe the following non-GAAP measures are useful in evaluating
our operational performance. We use the following non-GAAP
financial information to evaluate our ongoing operations and for
internal planning and forecasting purposes. We believe that
non-GAAP financial information, when taken collectively, may be
helpful to investors in assessing our operating performance.
EBITDA and Adjusted EBITDA
"EBITDA" is defined as net income (loss) before other
non-operating expense or income, income tax expense or benefit, and
depreciation and amortization. "Adjusted EBITDA" is defined as
EBITDA adjusted for unusual and other significant items that
management views as distorting the operating results from period to
period. Such adjustments may include stock-based compensation,
integration and acquisition-related charges, tangible and
intangible asset impairment charges, certain contingent liability
reversals, transformation, and foreign currency transaction gains
and losses. EBITDA and Adjusted EBITDA are intended as supplemental
measures of our performance that are neither required by, nor
presented in accordance with, GAAP. We believe that the use of
EBITDA and Adjusted EBITDA provides an additional tool for
investors to use in evaluating ongoing operating results and trends
and in comparing the Company's financial measures with those of
comparable companies, which may present similar non-GAAP financial
measures to investors. However, you should be aware that when
evaluating EBITDA and Adjusted EBITDA we may incur future expenses
similar to those excluded when calculating these measures. In
addition, our presentation of these measures should not be
construed as an inference that our future results will be
unaffected by unusual or non-recurring items. Our computation of
Adjusted EBITDA may not be comparable to other similarly titled
measures computed by other companies, because all companies may not
calculate Adjusted EBITDA in the same fashion.
Because of these limitations, EBITDA and Adjusted EBITDA should
not be considered in isolation or as a substitute for performance
measures calculated in accordance with GAAP. We compensate for
these limitations by relying primarily on our GAAP results and
using EBITDA and Adjusted EBITDA on a supplemental basis. You
should review the reconciliation of net loss to EBITDA and Adjusted
EBITDA below and not rely on any single financial measure to
evaluate our business.
The following table reconciles Net loss to EBITDA and Adjusted
EBITDA for the periods shown:
|
|
For the three
months ended
|
|
|
March
31,
|
(in
000's)
|
|
2021
|
|
2020
|
Net loss
|
$
|
(1,081)
|
$
|
(2,768)
|
|
Income tax expense
(benefit)
|
|
(1,264)
|
|
(1,748)
|
|
Interest
expense
|
|
5,059
|
|
6,583
|
|
Depreciation and
amortization
|
|
13,114
|
|
12,057
|
|
EBITDA
|
|
15,828
|
|
14,124
|
|
|
|
|
|
|
|
Change in fair value
of warrant liabilities (non-cash)
|
|
(2,424)
|
|
(1,912)
|
|
Transformation
expense
|
|
1,803
|
|
1,896
|
|
Acquisition and
integration-related restructuring costs
|
|
851
|
|
1,029
|
|
Stock-based
compensation (non-cash)
|
|
315
|
|
216
|
|
Foreign currency loss
(gain) (non-cash)
|
|
(70)
|
|
(1,686)
|
|
Other
|
|
115
|
|
43
|
|
Adjusted
EBITDA
|
$
|
16,418
|
$
|
13,710
|
|
|
|
|
|
|
|
|
|
|
Key Metrics
KORE reviews a number of metrics to measure our performance,
identify trends affecting our business, prepare financial
projections, and make strategic decisions. The calculation of the
key metrics and other measures discussed below may differ from
other similarly titled metrics used by other companies, securities
analysts, or investors.
Number of Customer Connections
Total Customer Connections constitutes the total of all KORE
Connectivity services connections, including both CaaS and CEaaS
connections, but excluding certain connections where mobile
carriers license KORE's subscription management platform from KORE.
Total Customer Connections include the contribution of eSIMs.
DBNER
DBNER (Dollar Based Net Expansion Rate) tracks the combined
effect of cross-sales of IoT Solutions to replace with KORE's
existing customers, its customer retention and the growth of its
existing business at customers. KORE calculates DBNER by dividing
the revenue for a given period ("given period") from go-forward,
existing customers by the revenue from the same customers for the
same period measured one year prior ("base period"). The revenue
included in the current period excludes revenue from (i) customers
that are not go-forward customers (i.e., customers which have
decided and communicated before the last day of the current period,
not to provide future business to KORE, and which customers are
expected to decline in revenue over time) and (ii) new customers
that started generating revenue after the end of the base period.
For example, to calculate our DBNER for the trailing 12 months
ended March 31, 2021, we divide (i)
revenue, for the trailing 12 months ended March 31, 2021, from customers that started
generating revenue on or before March 31,
2020, and that were go-forward customers as of March 31, 2021 by (ii) revenue, for the trailing
12 months ended March 31, 2020, from
the same set of customers. For the purposes of calculating DBNER,
if KORE acquires a company during the given period or the base
period, then the revenue of a customer before the acquisition but
during either the given period or the base period is included in
the calculation.
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SOURCE KORE Wireless