LogMeIn Announces Third Quarter 2019 Results

Oct 24, 2019

Exceeds Guidance with Growth Products Increasing 34% Year over Year 

BOSTON, Oct. 24, 2019 (GLOBE NEWSWIRE) -- LogMeIn, Inc. (NASDAQ: LOGM), a leading provider of cloud-based connectivity, today announced its results for the third quarter ended September 30, 2019.

Third quarter financial highlights include:

  • GAAP revenue was $316.9 million
  • Non-GAAP revenue was $317.2 million, up 2.5% year over year, a 60-basis point improvement from Q2’19
  • GAAP net income was $5.1 million or $0.10 per share and non-GAAP net income was $68.7 million or $1.39 per share
  • EBITDA was $82.2 million or 25.9% of GAAP revenue and Adjusted EBITDA was $109.3 million or 34.5% of non-GAAP revenue
  • Cash flow from operations was $83.0 million or 26.2% of non-GAAP revenue, and adjusted free cash flow was $69.6 million or 22.0% of non-GAAP revenue
  • Total GAAP deferred revenue was $392.8 million
  • The Company closed the quarter with cash and cash equivalents of $119.2 million and $200.0 million of borrowings under its existing credit agreement
  • The Company’s fastest growing products continued to gain market share with Jive increasing 37% year over year to $37 million and LastPass gaining 64% year over year to $22 million

Third quarter operational highlights include:

  • Launched the new, video first experience for GoToMeeting, which focuses on delivering a simple, intuitive end-user experience, while giving IT even more control over deployment, management, and security. The product includes industry-leading audio quality, a new meeting hub, powerful meeting diagnostics, and additional AI-powered transcription capabilities
  • Announced the general availability of GoToConnect and GoToRoom in the UK, Germany and Ireland, making the full GoTo Suite available in those markets
  • Named to the Gartner 2019 Magic Quadrant for both Unified Communications as a Service and Meeting Solutions  
  • LastPass Identity named the winner of the “Overall ID Management Solution of the Year” award in the 2019 CyberSecurity Breakthrough Awards

“Our investments in our growth products continued to pay off in the quarter and enabled us to exceed our guidance.  Led by Jive and LastPass, our growth products grew 34% in Q3 and now account for more than a quarter of our revenue,” said Bill Wagner, President and CEO.

“Additionally, we made significant progress strengthening our collaboration products, with the introduction of the next generation of our flagship GoToMeeting product and the launch of GoToConnect into key European markets.  We believe both of these milestones are foundational to continue to drive overall growth.”   

CFO Retirement in 2020
The Company is also announcing that LogMeIn’s Chief Financial Officer, Ed Herdiech, has informed the Company of his decision to retire in 2020, at a date to be determined.  In the interim, Ed has agreed to continue in his role in a full-time capacity in order to help transition his duties and to assist in the hiring and on-boarding of his successor. 

“I want to thank Ed for his distinguished service to LogMeIn over the past 13 years, during which time he has helped scale the Company from a small SaaS disruptor to a billion dollar market leader.  His leadership and execution have been critical throughout our history, including during our 2009 IPO and our transformational merger with the GoTo business. He has also built a strong team that is the operational backbone of the company.  I look forward to working with Ed through his transition in 2020 and we all wish him well as he looks forward to his retirement,” said Bill Wagner.

“I’ve had a great experience at LogMeIn.  I’ve enjoyed working with extremely smart people and developing a talented and dedicated team that has supported the business on its path from a start up to a billion-dollar SaaS company,” said Ed Herdiech.  “I believe the Company is well-positioned to be a leader in large, forward-leaning markets and I look forward to helping ensure a smooth transition.”

Business Outlook
Based on information available as of October 24, 2019, the Company is issuing guidance for the fourth quarter 2019 and fiscal year 2019. 

Fourth Quarter 2019:  The Company expects fourth quarter GAAP and non-GAAP revenue to be in the range of $319 million to $321 million. 

EBITDA is expected to be in the range of $89 million to $90 million, or approximately 28% of GAAP revenue.  Adjusted EBITDA is expected to be in the range of $110 million to $111 million, or approximately 34.5% of non-GAAP revenue. 

Non-GAAP net income is expected to be in the range of $68 million to $69 million, or $1.39 to $1.41 per diluted share.  Non-GAAP net income excludes an estimated $18 million in stock-based compensation expense, $3 million in acquisition and litigation-related costs, and $60 million of amortization expense of acquired intangible assets, as well as the income tax effect of the above items.  

Non-GAAP net income for the fourth quarter assumes an effective tax rate of approximately 25% and GAAP net income assumes a tax provision of approximately $3 million for the fourth quarter.  Non-GAAP and GAAP net income per diluted share is based on an estimated 49 million fully-diluted weighted average shares outstanding. 

Including stock-based compensation expense, acquisition-related costs and amortization, and litigation-related expense the Company expects to report GAAP net income in the range of $8 million to $9 million, or $0.15 to $0.17 per diluted share.      

Fiscal year 2019:  The Company expects full year 2019 non-GAAP revenue to be in the range of $1.258 billion to $1.260 billion.  The Company expects full year 2019 GAAP revenue to be in the range of $1.257 billion to $1.259 billion.  Non-GAAP revenue adds back $1 million for the impact of an acquisition accounting adjustment recorded to reduce acquired deferred revenue to the fair value of the remaining obligation.

EBITDA is expected to be in the range of $312 million to $313 million, or approximately 25% of GAAP revenue.  Adjusted EBITDA is expected to be in the range of $412 million to $413 million, or approximately 33% of non-GAAP revenue.

Non-GAAP net income is expected to be in the range of $256 million to $257 million, or $5.12 to $5.14 per diluted share.  Non-GAAP net income adds back the non-GAAP revenue adjustment described above and excludes an estimated $69 million in stock-based compensation expense, $15 million in acquisition and litigation-related costs, $241 million of amortization expense of acquired intangible assets, and $15 million of restructuring charges, as well as the income tax effect of the above items.

Non-GAAP net income for the fiscal year assumes an effective tax rate of approximately 25% and GAAP net loss for the fiscal year assumes a tax provision of approximately $4 million.  Non-GAAP net income per diluted share is based on an estimated 50 million fully-diluted weighted average shares outstanding.  GAAP net loss per share is based on an estimated 49.6 million weighted average shares outstanding.

Including stock-based compensation expense, acquisition-related costs and amortization, litigation-related expense, and restructuring charges, the Company expects to report GAAP net loss in the range of $3 million to $2 million, or $0.06 to $0.04 net loss per share.

Dividend
In accordance with its previously announced capital return plan, the Company will pay a $0.325 per share dividend on November 29, 2019 to stockholders of record as of November 13, 2019.  The Company currently has approximately 49 million shares of common stock outstanding.

Conference Call Information for Today, Thursday, October 24, 2019
The Company will host a corresponding conference call and live webcast at 5:00 p.m. Eastern Time today.  To access the conference call, dial (800) 309-1256 and enter passcode 689811.  A live webcast will be available on the Investor Relations section of the Company’s corporate website at https://www.logmeininc.com and via replay beginning approximately two hours after the completion of the call until the Company’s announcement of its financial results for the next quarter.  An audio replay of the call will also be available to investors beginning at approximately 8:00 p.m. Eastern Time on October 24, 2019 until 8:00 p.m. Eastern Time on October 31, 2019, by dialing 888-203-1112 and entering passcode 2282202.

Non-GAAP Financial Measures

This press release contains non-GAAP financial measures including non-GAAP revenue, EBITDA, EBITDA margin, adjusted EBITDA, adjusted EBITDA margin, non-GAAP operating income, non-GAAP income before provision for income taxes, non-GAAP provision for income taxes, non-GAAP net income, non-GAAP net income per diluted share, adjusted cash flow from operations, and adjusted free cash flow.

  • Non-GAAP revenue excludes the impact of the fair value acquisition accounting adjustment on acquired deferred revenue. 
  • EBITDA is GAAP net income (loss) excluding interest, income taxes, other (expense) income, net, and depreciation and amortization expense. 
  • EBITDA margin is calculated by dividing EBITDA by revenue. 
  • Adjusted EBITDA is EBITDA excluding the impact of the fair value acquisition accounting adjustment on acquired deferred revenue, acquisition-related costs, gain on disposition of non-core assets, stock-based compensation expense, restructuring charges, and litigation-related expense.  
  • Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by non-GAAP revenue, or GAAP revenue if not different.  
  • Non-GAAP operating income excludes the impact of the fair value acquisition accounting adjustment on acquired deferred revenue, acquisition related costs and amortization, gain on disposition of non-core assets, stock-based compensation expense, restructuring charges, and litigation-related expense and includes amortization expense for acquired company internally capitalized software development costs that were adjusted in acquisition accounting.
  • Non-GAAP provision for income taxes excludes the tax impact of the fair value acquisition accounting adjustment on acquired deferred revenue, acquisition-related costs and amortization, gain on disposition of non-core assets, stock-based compensation expense, restructuring charges, litigation-related expense, discrete integration related tax impacts, and the tax impact related to the enactment of the U.S. Tax Cuts and Jobs Act of 2017, and includes the tax impact of amortization expense for acquired company internally capitalized software development costs that were adjusted in acquisition accounting.
  • Non-GAAP net income and non-GAAP net income per diluted share reflects the adjustments noted in non-GAAP operating income and non-GAAP provision for income taxes above.
  • Adjusted cash flow from operations excludes acquisition retention-based bonus, litigation, restructuring, and acquisition-related payments and transaction and transition-related tax payments.
  • Adjusted free cash flow is adjusted cash flow from operations excluding purchases of property and equipment and intangible asset additions.

The exclusion of certain expenses in the calculation of non-GAAP financial measures should not be construed as an inference that these costs are unusual or infrequent. We anticipate excluding these expenses in the future presentation of our non-GAAP financial measures. The Company believes that these non-GAAP measures of financial results provide 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's management uses these non-GAAP measures to compare the Company's performance to that of prior periods and uses these measures in financial reports prepared for management and the Company's board of directors. 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 and in comparing the Company's financial measures with other software-as-a-service companies, many of which present similar non-GAAP financial measures to investors. The Company does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant elements that are required by GAAP to be recorded in the Company's financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management in determining these non-GAAP financial measures. In order to compensate for these limitations, management of the Company presents its non-GAAP financial measures in connection with its GAAP results. The Company urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing quarterly financial results, and not to rely on any single financial measure to evaluate the Company's business. Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP measures used in this press release are included in this release.

About LogMeIn, Inc.
LogMeIn, Inc. (NASDAQ: LOGM) simplifies how people connect with each other and the world around them to drive meaningful interactions, deepen relationships, and create better outcomes for individuals and businesses. One of the world’s top 10 public SaaS companies, and a market leader in unified communications and collaboration, identity and access management, and customer engagement and support solutions, LogMeIn has millions of customers spanning virtually every country across the globe. LogMeIn is headquartered in Boston, Massachusetts with additional locations in North America, South America, Europe, Asia and Australia.

Cautionary Language Concerning Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding the progress made on the Company’s strategic initiatives and revenue growth objectives, improvements made to the Company’s competitive positioning, as well as the Company's financial guidance for the fourth quarter of 2019 and fiscal year 2019. These forward-looking statements are made as of the date they were first issued and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as "expect," "anticipate," "should," "believe," "hope," "target," "project," "goals," "estimate," "potential," "predict," "may," "will," "might," "could," "intend," variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond the Company's control.  The Company's actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to, customer adoption of the Company's solutions, the Company’s ability to execute on its strategic initiatives, the Company’s ability to integrate acquired products or companies, the Company's ability to attract new customers and retain existing customers, adverse economic conditions in general and adverse economic conditions specifically affecting the markets in which the Company operates, the effectiveness of the Company’s cybersecurity measures, the Company's ability to continue to promote and maintain its brand in a cost-effective manner, the Company's ability to compete effectively, the Company's ability to develop and introduce new products and add-ons or enhancements to existing products, the Company's ability to manage growth, the Company's ability to attract and retain key personnel, the Company's ability to protect its intellectual property and other proprietary rights, the result of any pending litigation including intellectual property litigation, and other risks detailed in the Company's other publicly available filings with the Securities and Exchange Commission. Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent the Company's views as of the date of this press release. The Company anticipates that subsequent events and developments will cause its views to change. The Company undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing the Company's views as of any date subsequent to the date of this press release.

LogMeIn is a registered trademark of LogMeIn, Inc. in the US and other countries around the world.

Contact Information:
Investors
Rob Bradley   
LogMeIn, Inc.
781-897-1301
Rob.Bradley@LogMeIn.com 

Press
Craig VerColen
LogMeIn, Inc.
781-897-0696
Press@LogMeIn.com 

LogMeIn, Inc.  
Condensed Consolidated Balance Sheets (unaudited)  
(In thousands)  
           
    December 31,   September 30,  
      2018       2019    
           
ASSETS  
Current assets:          
  Cash and cash equivalents   $ 148,652     $ 119,197    
  Accounts receivable, net     95,354       80,876    
  Prepaid expenses and other current assets     83,887       81,120    
  Total current assets     327,893       281,193    
Property and equipment, net     98,238       97,005    
Operating lease assets     -       101,345    
Restricted cash, net of current portion     1,840       1,834    
Intangibles, net     1,059,988       895,800    
Goodwill     2,400,390       2,414,335    
Other assets     41,545       61,261    
Deferred tax assets     6,059       5,895    
  Total assets   $ 3,935,953     $ 3,858,668    
           
LIABILITIES AND EQUITY  
Current liabilities:          
  Accounts payable   $ 35,447     $ 56,671    
  Current operating lease liabilities     -       17,900    
  Accrued liabilities     119,379       144,285    
  Deferred revenue, current portion     369,780       381,635    
  Total current liabilities     524,606       600,491    
Long-term debt     200,000       200,000    
Deferred revenue, net of current portion     9,518       11,189    
Deferred tax liabilities     201,212       170,378    
Non-current operating lease liabilities     -       91,407    
Other long-term liabilities     25,929       10,077    
  Total liabilities     961,265       1,083,542    
Equity:          
  Common stock     567       572    
  Additional paid-in capital     3,316,603       3,349,108    
  Retained earnings     84,043       24,854    
  Accumulated other comprehensive income (loss)     2,133       (1,946 )  
  Treasury stock     (428,658 )     (597,462 )  
  Total equity     2,974,688       2,775,126    
Total liabilities and equity   $ 3,935,953     $ 3,858,668    
           



LogMeIn, Inc.
 
Condensed Consolidated Statements of Operations (unaudited)
 
(In thousands, except per share data)
 
                   
    Three Months Ended September 30,   Nine Months Ended September 30,  
      2018       2019       2018       2019    
                   
Revenue   $ 308,927     $ 316,941     $ 893,794     $ 937,705    
Cost of revenue     72,853       81,230       208,628       239,685    
  Gross profit     236,074       235,711       685,166       698,020    
Operating expenses:                  
  Research and development     42,220       39,452       129,256       120,548    
  Sales and marketing     95,041       110,604       282,599       346,063    
  General and administrative     37,441       34,954       111,990       103,379    
  Restructuring charge     -       5,172       -       14,602    
  Gain on disposition of assets     -       -       (33,910 )     -    
  Amortization of acquired intangibles     44,268       39,368       128,698       118,257    
  Total operating expenses     218,970       229,550       618,633       702,849    
Income (loss) from operations     17,104       6,161       66,533       (4,829 )  
  Interest income     293       299       1,335       1,375    
  Interest expense     (2,033 )     (2,048 )     (4,213 )     (6,317 )  
  Other income (expense), net     (77 )     180       (403 )     (187 )  
Income (loss) before income taxes     15,287       4,592       63,252       (9,958 )  
(Provision for) benefit from income taxes     (2,570 )     516       (14,269 )     (495 )  
Net income (loss)   $ 12,717     $ 5,108     $ 48,983     $ (10,453 )  
                   
Net income (loss) per share:                  
  Basic   $ 0.25     $ 0.10     $ 0.94     $ (0.21 )  
  Diluted   $ 0.24     $ 0.10     $ 0.93     $ (0.21 )  
Weighted average shares outstanding:                  
  Basic     51,652       49,265       52,090       49,886    
  Diluted     52,066       49,368       52,829       49,886    
                   



LogMeIn, Inc.
 
Calculation of Non-GAAP Revenue (unaudited)
 
                     
      Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
        2018       2019       2018       2019    
       (in thousands)
   (in thousands)
 
GAAP Revenue   $ 308,927     $ 316,941     $ 893,794     $ 937,705    
  Add Back:                  
  Effect of acquisition accounting on fair value of acquired deferred revenue     654       230       3,186       978    
Non-GAAP Revenue   $ 309,581     $ 317,171     $ 896,980     $ 938,683    
                     
Calculation of Non-GAAP Operating Income, Non-GAAP Net Income and Non-GAAP Net Income per Diluted Share (unaudited)
 
                     
      Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
        2018       2019       2018       2019    
       (In thousands, except per share data)
  (In thousands, except per share data)
 
GAAP Net income (loss) from operations   $ 17,104     $ 6,161     $ 66,533     $ (4,829 )  
  Add Back:                  
  Effect of acquisition accounting on fair value of acquired deferred revenue     654       230       3,186       978    
  Stock-based compensation expense     15,688       17,611       48,820       50,845    
  Acquisition related costs     4,698       3,390       19,074       10,261    
  Restructuring charge     -       5,172       -       14,602    
  Litigation related expenses     199       713       476       1,406    
  Amortization of acquired intangibles     62,484       60,227       183,086       181,124    
  Gain on disposition of assets     -       -       (33,910 )     -    
  Effect of acquisition accounting on internally capitalized software development costs     (1,505 )     -       (7,636 )     -    
Non-GAAP Operating income     99,322       93,504       279,629       254,387    
  Interest and other expense, net     (1,817 )     (1,569 )     (3,281 )     (5,129 )  
Non-GAAP Income before income taxes     97,505       91,935       276,348       249,258    
  Non-GAAP Provision for income taxes (1)     (24,637 )     (23,231 )     (68,811 )     (62,090 )  
Non-GAAP Net income   $ 72,868     $ 68,704     $ 207,537     $ 187,168    
                     
Non-GAAP net income per diluted share   $ 1.40     $ 1.39     $ 3.93     $ 3.73    
Diluted weighted average shares outstanding used in                  
  computing per share amounts     52,066       49,368       52,829       50,198    
                     
(1 ) The non-GAAP provision for income taxes reported in the three and nine months ended September 30, 2018 and 2019 excludes the tax impact of non-GAAP items, and for the nine months ended September 30, 2018 excludes a net discrete integration-related tax benefit of $2.0 million as well as a net tax benefit of $2.9 million and $2.2 million in the three and nine months ended September 30, 2018, respectively, related to the enactment of the U.S. Tax Act.  
                     
Calculation of EBITDA and Adjusted EBITDA (unaudited)
 
                     
      Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
        2018       2019       2018       2019    
       (in thousands)
   (in thousands)
 
GAAP Net income (loss)   $ 12,717     $ 5,108     $ 48,983     $ (10,453 )  
  Add Back:                  
  Interest and other expense, net     1,817       1,569       3,281       5,129    
  Income tax provision (benefit)     2,570       (516 )     14,269       495    
  Amortization of acquired intangibles     62,484       60,227       183,086       181,124    
  Depreciation and amortization expense     14,337       15,795       40,096       47,231    
EBITDA     93,925       82,183       289,715       223,526    
  Add Back:                  
  Effect of acquisition accounting on fair value of acquired deferred revenue     654       230       3,186       978    
  Stock-based compensation expense     15,688       17,611       48,820       50,845    
  Gain on disposition of assets     -       -       (33,910 )     -    
  Acquisition related costs     4,698       3,390       19,074       10,261    
  Restructuring charge     -       5,172       -       14,602    
  Litigation related expenses     199       713       476       1,406    
Adjusted EBITDA   $ 115,164     $ 109,299     $ 327,361     $ 301,618    
  EBITDA Margin     30.4 %     25.9 %     32.4 %     23.8 %  
  Adjusted EBITDA Margin     37.2 %     34.5 %     36.5 %     32.1 %  
                     
Calculation of Adjusted Cash Flows from Operations and Adjusted Free Cash Flow (unaudited)
 
                     
      Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
        2018       2019       2018       2019    
       (in thousands)
   (in thousands)
 
GAAP Cash flows from operations   $ 73,662     $ 83,001     $ 330,864     $ 286,368    
  Add Back:                  
  Litigation related payments     16       803       1,163       822    
  Acquisition retention-based bonus     2,486       1,355       3,143       6,581    
  Restructuring payments     -       2,449       -       9,498    
  Partial tax payment for gain on Xively disposition     4,236       -       4,236       -    
  Transaction related payments (acquisitions and dispositions)     3,120       438       16,794       2,317    
Adjusted cash flows from operations     83,520       88,046       356,200       305,586    
  Purchases of property and equipment     (7,960 )     (7,732 )     (21,590 )     (29,813 )  
  Intangible asset additions     (8,276 )     (10,676 )     (26,138 )     (29,421 )  
Adjusted Free Cash Flow   $ 67,284     $ 69,638     $ 308,472     $ 246,352    
  GAAP Cash flows from operations as a % of Non-GAAP Revenue     23.8 %     26.2 %     36.9 %     30.5 %  
  Adjusted Cash flows from operations as a % of Non-GAAP Revenue     27.0 %     27.8 %     39.7 %     32.6 %  
  Adjusted Free Cash Flow as a % of Non-GAAP Revenue     21.7 %     22.0 %     34.4 %     26.2 %  
                     
Stock-Based Compensation Expense (unaudited)
 
                     
      Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
        2018       2019       2018       2019    
      (in thousands)
  (in thousands)
 
  Cost of revenue   $ 1,278     $ 1,309     $ 3,755     $ 3,590    
Research and development (1)     4,174       4,836       14,232       12,825    
Sales and marketing (1)     3,492       4,218       11,788       13,212    
  General and administrative     6,744       7,248       19,045       21,218    
  Total stock based-compensation   $ 15,688     $ 17,611     $ 48,820     $ 50,845    
                     
(1 ) The stock-based compensation expense disclosure reported in the table above for the nine months ended September 30, 2019 includes a reclassification from research and development to sales and marketing of $1.4 million ($0.630 million and $0.731 million for the three months ended March 31, 2019 and June 30, 2019, respectively).  
   
                     


LogMeIn, Inc.  
Calculation of Projected 2019 Non-GAAP Revenue (unaudited)  
(In millions)  
             
      Three Months Ended   Twelve Months Ended
 
      December 31, 2019   December 31, 2019  
             
GAAP Revenue   $319 - $321   $1,257 - $1,259  
 Add Back:          
 Effect of acquisition accounting on fair value of acquired deferred revenue   -   1  
Non-GAAP Revenue   $319 - $321   $1,258 - $1,260  
             
Calculation of Projected 2019 Non-GAAP Net Income and Non-GAAP Net Income per Diluted Share (unaudited)  
(In millions, except per share data)  
             
      Three Months Ended   Twelve Months Ended
 
      December 31, 2019   December 31, 2019  
             
GAAP Net income (loss)   $8 - $9   $(3) - $(2)  
 Add Back:          
 Effect of acquisition accounting on fair value of acquired deferred revenue      
 Stock-based compensation expense   18    69   
 Acquisition and litigation related costs     15   
 Restructuring charges     15   
 Amortization of acquired intangibles   60    241   
 Income tax effect of non-GAAP items   (21)   (82)  
Non-GAAP Net income   $68 - $69   $256 - $257  
             
GAAP net income per diluted share, (loss) per share   $0.15 - $0.17   $(0.06) - $(0.04)  
Non-GAAP net income per diluted share   $1.39 - $1.41   $5.12 - $5.14  
Weighted average shares outstanding used in computing net loss per share       49.6   
Diluted weighted average shares outstanding used in computing net income per diluted share   49.0    50.0   
             
             
Calculation of Projected 2019 EBITDA and Adjusted EBITDA (unaudited)  
(In millions)  
             
      Three Months Ended   Twelve Months Ended
 
      December 31, 2019   December 31, 2019  
             
GAAP Net income (loss)     $8 - $9   $(3) - $(2)  
 Add Back:          
 Interest and other (income) expense, net      
 Income tax provision (benefit)      
 Amortization of acquired intangibles   60    241   
 Depreciation and amortization expense   16    63   
EBITDA   $89 - $90   $312 - $313  
 Add Back:          
 Effect of acquisition accounting on fair value of acquired deferred revenue      
 Stock-based compensation expense   18    69   
 Acquisition and litigation related costs     15   
 Restructuring charges     15   
Adjusted EBITDA   $110 - $111   $412 -$413  
 EBITDA Margin   28%   25%  
 Adjusted EBITDA Margin   34.5%   33%  
             



LogMeIn, Inc.
Condensed Consolidated Statements of Cash Flows (unaudited
(In thousands)
                     
        Three Months Ended
September 30,
  Nine Months Ended
September 30,
          2018       2019       2018       2019  
Cash flows from operating activities   $ 12,717     $ 5,108     $ 48,983     $ (10,453 )
Net income (loss)                
Adjustments to reconcile net income (loss) to net cash                
  provided by operating activities:                
  Stock-based compensation     15,688       17,611       48,820       50,845  
  Depreciation and amortization     76,821       76,022       223,181       228,355  
  Gain on disposition of assets, excluding transaction costs     -       -       (36,281 )     -  
  Change in fair value of contingent consideration liability     -       389       -       581  
  Restructuring-related property and equipment charges     -       3,164       -       3,164  
  Benefit from deferred income taxes     (12,032 )     (11,315 )     (34,062 )     (34,101 )
  Other, net     489       335       1,282       1,274  
  Changes in assets and liabilities, excluding effect of acquisitions and dispositions:            
  Accounts receivable     (6,429 )     8,498       16,301       12,608  
  Prepaid expenses and other current assets     518       (10,192 )     8,474       (5,415 )
  Other assets     (4,897 )     (6,841 )     (12,830 )     (20,387 )
  Accounts payable     2,072       5,944       13,575       21,451  
  Accrued liabilities     (1,848 )     7,920       21,113       24,146  
  Deferred revenue     (7,752 )     (12,586 )     28,031       17,664  
  Other long-term liabilities     (1,685 )     (1,056 )     4,277       (3,364 )
  Net cash provided by operating activities     73,662       83,001       330,864       286,368  
Cash flows from investing activities                
Purchases of property and equipment     (7,960 )     (7,732 )     (21,590 )     (29,813 )
Intangible asset additions     (8,276 )     (10,676 )     (26,138 )     (29,421 )
Acquisition of businesses, net of cash acquired     1,279       -       (342,072 )     (22,463 )
Proceeds from disposition of assets     -       7,500       42,394       7,500  
  Net cash provided by (used in) investing activities     (14,957 )     (10,908 )     (347,406 )     (74,197 )
Cash flows from financing activities                
Borrowings (repayments) under credit facility     -       -       200,000       -  
Proceeds from issuance of common stock upon option exercises     2,809       51       3,831       133  
Payments of withholding taxes in connection with restricted stock unit vesting   (1,536 )     (792 )     (29,490 )     (18,468 )
Payment of contingent consideration     -       -       -       (1,857 )
Dividends paid on common stock     (15,523 )     (16,037 )     (46,900 )     (48,736 )
Purchase of treasury stock     (75,127 )     (44,956 )     (190,230 )     (169,188 )
  Net cash provided by (used in) financing activities     (89,377 )     (61,734 )     (62,789 )     (238,116 )
Effect of exchange rate changes on cash, cash equivalents and restricted cash     (538 )     (2,724 )     (5,427 )     (3,516 )
Net increase (decrease) in cash, cash equivalents and restricted cash     (31,210 )     7,635       (84,758 )     (29,461 )
Cash, cash equivalents and restricted cash, beginning of period     200,661       113,396       254,209       150,492  
Cash, cash equivalents and restricted cash, end of period   $ 169,451     $ 121,031     $ 169,451     $ 121,031  
                     

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Source: LogMeIn, Inc.

NASDAQ:LOGM
Price 78.98 +0.80 +1.02% Volume: 614,781 Nov 19, 2019 PM ET Pricing delayed 20 minutes> More

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Investor Contact

Rob Bradley
Vice President of Investor Relations
Phone: (781) 897-1301

InvestorRelations@LogMeIn.com

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You are now leaving LogMeIn's website and are being directed to a website that is operated and maintained by a third party (an "External Site"). LogMeIn does not control the External Site and is not responsible for the data, content or availability of the External Site. This link to the External Site is provided for convenience purposes only. We make no representation or warranty regarding the accuracy of the information contained in the External Sites. We suggest that you always verify the information obtained from linked websites before acting upon this information. Also, please be aware that the security and privacy policies on this External Site may be different than LogMeIn’s policies, so we encourage you to read any third party privacy and security policies closely.

LogMeIn’s filings with the U.S. Securities and Exchange Commission, or SEC, including LogMeIn’s annual reports on Form 10-K which include our audited financial statements, are available on LogMeIn’s Investor Relations website at https://investor.logmeininc.com/about-us/investors/financials/sec-filings/default.aspx free of charge. The data and other content contained on the External Site are not meant, and should not be used, as a substitute for information contained in LogMeIn’s filings with the SEC or disclosed through other channels used by LogMeIn to comply with its disclosure obligations under Regulation FD. The reports contained on the External Site may contain forward-looking information about LogMeIn’s future financial performance and results. Please note that the information presented on the External Site is deemed representative at the time of its original release and that changes in historical information may occur. LogMeIn undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee these results. We caution you to consider the risk factors described in our SEC filings, which could cause actual results to differ materially from the forward-looking statements disclosed on the External Site.

Non-GAAP Information

The External Site may contain certain non-GAAP and pro forma non-GAAP financial measures, in addition to financial measures determined in accordance with GAAP. “GAAP” refers to generally accepted accounting principles in the United States. The non-GAAP financial measures contained on the External Sites are not prepared in accordance with GAAP and may not be comparable to non-GAAP financial measures used by other companies. The non-GAAP information should be considered in addition to, but not as a substitute for or superior to, other measures of financial performance prepared in accordance with GAAP. LogMeIn urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing its quarterly financial results, and not to rely on any single financial measure to evaluate the Company's business. Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP measures are included in LogMeIn’s quarterly press releases, which can be found in the Financials section of LogMeIn’s investor relations website under “Quarterly Results.”

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