sgh-8k_20190627.htm

 

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): June 27, 2019

 

SMART GLOBAL HOLDINGS, INC.

(Exact name of Registrant as Specified in Its Charter)

 

 Cayman Islands

001-38102

98-1013909

(State or Other Jurisdiction

of Incorporation)

(Commission File Number)

(IRS Employer

Identification No.)

c/o Maples Corporate Services Limited

P.O. Box 309

Ugland House

Grand Cayman

 

KY1-1104

Cayman Islands

(Zip Code)

(Address of Principal Executive Offices)

 

 

 

Registrant’s Telephone Number, Including Area Code: (510) 623-1231

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Ordinary shares, $0.03 par value per share

SGH

The NASDAQ Stock Market LLC

(NASDAQ Global Select Market)

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

 

 

 

 


 

Item 2.02 Results of Operations and Financial Condition.

On June 27, 2019, SMART Global Holdings, Inc. (the “Company”) issued a press release and will hold a conference call announcing its financial results for the third quarter of fiscal 2019. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The Company refers to non-GAAP financial information in both the press release and the conference call. A reconciliation of these non-GAAP financial measures to the comparable GAAP financial measures is contained in the attached press release.

This information is intended to be furnished under Item 2.02 of Form 8-K, “Results of Operations and Financial Condition” and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.  

Item 9.01 Financial Statements and Exhibits.

 

Exhibit Number

 

Description of Exhibit

 

 

 

99.1

 

Press release issued on June 27, 2019

 

 

1


 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

SMART GLOBAL HOLDINGS, INC.

 

 

 

By:

 /s/ JACK PACHECO

 

 Name:

 Jack Pacheco

 

 Title: 

 Executive Vice President and Chief Financial Officer

 

 

(Principal Financial and Accounting Officer)

 

 

 

Date: June 27, 2019

 

 

2

sgh-ex991_6.htm

Exhibit 99.1

Press Release

FOR IMMEDIATE RELEASE

 

SMART Global Holdings Reports

Third Quarter Fiscal 2019 Financial Results

 

NEWARK, CA – June 27, 2019 SMART Global Holdings, Inc. (“SMART”) (NASDAQ: SGH), parent company of SMART Modular Technologies, Inc., today reported financial results for the third quarter of fiscal 2019 ended May 31, 2019.

 

Financial Highlights Q3FY19:

 

Net sales of $235.7 million

 

GAAP EPS of $0.08

 

Non-GAAP EPS of $0.34

 

GAAP gross margin of 18.3%

 

Non-GAAP gross margin of 18.5%

 

Cash and equivalents of $126 million

 

Cash flow from operations up 19% sequentially to $46 million

 

Specialty Products revenue YTD up 12% to $354 million

 

“Despite significant declines in memory pricing that caused our revenue to be weaker than expected during our third fiscal quarter, we were able to achieve non-GAAP earnings which was within the range of our guidance,” commented Ajay Shah, Chairman and Chief Executive Officer.  “Importantly, during the quarter we maintained our gross margins and generated $46 million in cash flow from operations, ending the quarter with $126 million in cash on the balance sheet thus positioning us well to execute on our growth strategies.”

 

“As we look forward to our fourth fiscal quarter ending in August, we are forecasting significantly better revenue and earnings performance even though the memory pricing environment remains weak. This is due to improvements in Specialty Memory unit volumes and strength in Specialty Compute. ” concluded Mr. Shah.

 

Quarterly Financial Results

GAAP (1)

 

 

Non-GAAP (2)

 

(In millions, except per share amounts)

Q3 FY19

 

Q2 FY19

 

Q3 FY18

 

 

Q3 FY19

 

Q2 FY19

 

Q3 FY18

 

Net sales

$

235.7

 

$

304.1

 

$

335.5

 

 

$

235.7

 

$

304.1

 

$

335.5

 

Gross profit

$

43.0

 

$

57.1

 

$

78.1

 

 

$

43.7

 

$

57.8

 

$

78.5

 

Operating income

$

7.4

 

$

22.5

 

$

48.7

 

 

$

13.2

 

$

27.7

 

$

53.8

 

Net income

$

1.9

 

$

12.8

 

$

31.9

 

 

$

7.9

 

$

18.0

 

$

43.0

 

Diluted earnings per share (EPS)

$

0.08

 

$

0.55

 

$

1.37

 

 

$

0.34

 

$

0.77

 

$

1.84

 

 

(1)

GAAP represents U.S. Generally Accepted Accounting Principles.

(2)

Please refer to the “Non-GAAP Information” section and the "Reconciliation of Non-GAAP Financial Measures" table below for further detail on the non-GAAP financial reporting referenced above and a reconciliation of such measures to our nearest GAAP measures.


 

Business Outlook

The following statements are based upon management's current expectations for the fourth quarter of fiscal 2019 ending August 30, 2019. These statements are forward-looking, and actual results may differ materially. SMART undertakes no obligation to update these statements.

 

Net Sales

$270 to $280 million

Gross Margin - GAAP / Non-GAAP

19% to 21%

Diluted EPS - GAAP

$0.33 to $0.43

 

 

Share-based compensation per share

$0.18

Intangible amortization per share

$0.04

 

 

Diluted EPS - Non-GAAP

$0.55 to $0.65

 

 

Expected diluted share count

23.5 million

 

Conference Call Details

SMART will host a conference call today for analysts and investors at 1:30 p.m. Pacific time, 4:30 p.m. Eastern time. Dial-in US toll free +1-866-487-6452 using access code 3277125.

 

A replay of the conference call will be available for one week following today’s call through the Events section of the SMART website at www.smartgh.com or by calling US toll free +1-855-859-2056; Passcode: 3277125.

Forward-Looking Statements

This release contains, and statements made during the above-referenced conference call will contain "forward-looking statements" including among other things, statements regarding future events and the future financial performance of SMART (including the business outlook for the next fiscal quarter) and statements regarding growth drivers in SMART’s industries and markets. These statements are only predictions and may differ materially from actual future events or results due to a variety of factors, including but not limited to: business and economic conditions and growth trends in the technology industry, our customer markets and various geographic regions; global economic conditions and uncertainties in the geopolitical environment; changes in seasonal impacts on our results; changes in currency exchange rates; overall information technology spending; appropriations for government spending; the success of our strategic initiatives including additional investments in new products, additional capacity and acquisitions; the DRAM market and the temporary and volatile nature of pricing trends; deterioration in customer relationships; production or manufacturing difficulties; competitive factors; technological changes; difficulties with or delays in the introduction of new products;  slowing or contraction of growth in the memory market in Brazil; reduction in or termination of local content requirements in Brazil;  changes to applicable tax regimes or rates; prices for the end products of our customers; fluctuations in material costs and availability; strikes or labor disputes; deterioration in or loss of relations with any of our limited number of key vendors;  changes in the availability of supply of materials, components or memory products; the inability of Penguin Computing to obtain and retain security clearances to expand its government business; and other factors and risks detailed in SMART’s filings with the Securities and Exchange Commission. Such factors and risks as outlined above and in such filings may not constitute all factors and risks that could cause actual results of SMART to be materially different from the historical results and/or from any future results or outcomes expressed or implied by such forward-looking statements. SMART and its subsidiaries operate in a continually changing business environment and new factors emerge from time to time. SMART cannot predict such factors, nor can it assess the impact, if any, from such factors on SMART or its subsidiaries’ results. Accordingly, investors are cautioned not to place undue reliance on any forward-looking statements. Forward-looking statements should not be relied upon as a prediction of actual results. These forward-looking statements are made as of today, and SMART does not intend, and has no obligation, to update or revise any forward-looking statements in order to reflect events or circumstances that may arise after the date of this press release, except as required by law.

 

Non-GAAP Information

Certain non-GAAP financial measures are contained in this press release or will be discussed on our conference call, including non-GAAP gross profit, non-GAAP operating income, Adjusted EBITDA, non-GAAP net income, non-GAAP net income per diluted share, and non-GAAP diluted EPS. We define Adjusted EBITDA as GAAP net income plus net interest expense, income tax expense, depreciation and amortization expense, share-based compensation expense, acquisition-related expenses and other infrequent or unusual items. Adjusted EBITDA is not a measure of financial performance calculated in accordance with U.S. GAAP and should be viewed as a supplement to, not a substitute for, our results of operations presented on the basis of U.S. GAAP. Adjusted EBITDA also


does not purport to represent cash flow provided by, or used in, operating activities in accordance with U.S. GAAP and should not be used as a measure of liquidity.

 

The non-GAAP financial results presented herein exclude share-based compensation expense, intangible amortization expense, acquisition-related expenses, and other infrequent or unusual items, and with respect to non-GAAP diluted EPS, foreign currency gains (losses). These non-GAAP financial measures are provided to enhance the user's overall understanding of our financial performance. By excluding these charges, as well as any related tax effects, our non-GAAP results provide information to management and investors that is useful in assessing SMART's core operating performance and in evaluating and comparing our results of operations on a consistent basis from period to period. These non-GAAP financial measures are also used by management to evaluate financial results, to plan and forecast future periods, and to assess performance of certain executives for compensation purposes. The presentation of this additional information is not meant to be a substitute for the corresponding financial measures prepared in accordance with U.S. GAAP. In addition, similarly titled measures may not be used similarly by other companies and therefore may not be comparable between companies.

 

Investors are encouraged to review the “Reconciliation of Non-GAAP Financial Measures to GAAP Results” and “Reconciliation of GAAP Net Income to Adjusted EBITDA” tables below for more detail on non-GAAP calculations.

 

About SMART Global Holdings

The SMART family of companies are global leaders in specialty memory, storage and hybrid solutions serving the electronics industry with standard and custom products for over 25 years. SMART delivers components, modules and solutions to a broad customer base, including OEMs in computing, networking, communications, storage, mobile and industrial markets. With the addition of Penguin Computing and the creation of a new business unit, SMART Specialty Compute & Storage Solutions (SCSS), SMART has expanded its serviceable markets into areas requiring specialized computing platforms in artificial intelligence and machine learning, advanced modeling and high performance computing. Customers rely on SMART as a strategic supplier with custom designs, product quality, technical support, a global footprint, and the ability to provide locally manufactured products in multiple geographies. See www.smartgh.com, www.smartm.com, www.smarth.com, or www.smartsscs.com for more information.


SMART Global Holdings, Inc.

and Subsidiaries

Consolidated Statements of Income

(In thousands, except per share data)

 

  

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

May 31,

2019

 

 

March 1,

2019

 

 

May 25,

2018

 

 

May 31,

2019

 

 

May 25,

2018

 

Net sales:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Brazil

 

$

100,982

 

 

$

147,111

 

 

$

232,742

 

 

$

447,372

 

 

$

599,225

 

Specialty Memory

 

 

98,755

 

 

 

115,608

 

 

 

102,735

 

 

 

354,312

 

 

 

315,626

 

Specialty Compute and Storage Solutions

 

 

35,920

 

 

 

41,344

 

 

 

 

 

 

131,915

 

 

 

 

Total net sales

 

 

235,657

 

 

 

304,063

 

 

 

335,477

 

 

 

933,599

 

 

 

914,851

 

Cost of sales (1)(2)

 

 

192,622

 

 

 

246,932

 

 

 

257,423

 

 

 

748,364

 

 

 

705,944

 

Gross profit

 

 

43,035

 

 

 

57,131

 

 

 

78,054

 

 

 

185,235

 

 

 

208,907

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development (1) (2)

 

 

11,330

 

 

 

11,238

 

 

 

9,763

 

 

 

34,384

 

 

 

28,165

 

Selling, general and administrative (1) (2)

 

 

24,306

 

 

 

23,442

 

 

 

19,597

 

 

 

73,202

 

 

 

55,502

 

Total operating expenses

 

 

35,636

 

 

 

34,680

 

 

 

29,360

 

 

 

107,586

 

 

 

83,667

 

Income from operations

 

 

7,399

 

 

 

22,451

 

 

 

48,694

 

 

 

77,649

 

 

 

125,240

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

(5,001

)

 

 

(5,273

)

 

 

(4,098

)

 

 

(16,149

)

 

 

(12,927

)

Other income (expense):

 

 

97

 

 

 

252

 

 

 

(7,145

)

 

 

(2,980

)

 

 

(7,312

)

Total other expense

 

 

(4,904

)

 

 

(5,021

)

 

 

(11,243

)

 

 

(19,129

)

 

 

(20,239

)

Income before income taxes

 

 

2,495

 

 

 

17,430

 

 

 

37,451

 

 

 

58,520

 

 

 

105,001

 

Provision for income taxes

 

 

550

 

 

 

4,644

 

 

 

5,505

 

 

 

12,813

 

 

 

15,256

 

Net income

 

$

1,945

 

 

$

12,786

 

 

$

31,946

 

 

$

45,707

 

 

$

89,745

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.08

 

 

$

0.56

 

 

$

1.44

 

 

$

2.00

 

 

$

4.09

 

Diluted

 

$

0.08

 

 

$

0.55

 

 

$

1.37

 

 

$

1.96

 

 

$

3.90

 

Shares used in computing per-share calculation:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

23,005

 

 

 

22,872

 

 

 

22,206

 

 

 

22,824

 

 

 

21,932

 

Diluted

 

 

23,330

 

 

 

23,359

 

 

 

23,306

 

 

 

23,374

 

 

 

23,020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Includes share-based compensation expense as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

$

651

 

 

$

607

 

 

$

414

 

 

$

1,803

 

 

$

859

 

Research and development

 

 

673

 

 

 

660

 

 

 

325

 

 

 

1,967

 

 

$

887

 

Selling, general and administrative

 

 

3,109

 

 

 

2,881

 

 

 

2,558

 

 

 

8,866

 

 

$

4,853

 

Total stock-based compensation expense

 

$

4,433

 

 

$

4,148

 

 

$

3,297

 

 

$

12,636

 

 

$

6,599

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2) Includes amortization of intangible assets expense as

   follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

$

16

 

 

$

98

 

 

$

 

 

$

130

 

 

$

 

Research and development

 

 

 

 

 

 

 

 

245

 

 

 

 

 

 

735

 

Selling, general and administrative

 

 

961

 

 

 

961

 

 

 

976

 

 

 

2,883

 

 

 

2,992

 

Total amortization expense

 

$

977

 

 

$

1,059

 

 

$

1,221

 

 

$

3,013

 

 

$

3,727

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


SMART Global Holdings, Inc.

and Subsidiaries

Reconciliation of Non-GAAP Financial Measures to GAAP Results

(In thousands, except per share data)

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

May 31,

2019

 

 

March 1,

2019

 

 

May 25,

2018

 

 

May 31,

2019

 

 

May 25,

2018

 

Reconciliation of gross profit:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP gross profit

 

$

43,035

 

 

$

57,131

 

 

$

78,054

 

 

$

185,235

 

 

$

208,907

 

GAAP gross margin

 

 

18.3

%

 

 

18.8

%

 

 

23.3

%

 

 

19.8

%

 

 

22.8

%

Add: Share-based compensation included in cost of sales

 

 

651

 

 

 

607

 

 

 

414

 

 

 

1,803

 

 

 

859

 

Add: Amortization of intangible assets

 

 

16

 

 

 

98

 

 

 

 

 

 

130

 

 

 

 

Non-GAAP gross profit

 

$

43,702

 

 

$

57,836

 

 

$

78,468

 

 

$

187,168

 

 

$

209,766

 

Non-GAAP gross margin

 

 

18.5

%

 

 

19.0

%

 

 

23.4

%

 

 

20.0

%

 

 

22.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP operating expenses

 

$

35,636

 

 

$

34,680

 

 

$

29,360

 

 

$

107,586

 

 

$

83,667

 

Less: Share-based compensation expense included in opex

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

673

 

 

 

660

 

 

 

325

 

 

 

1,967

 

 

 

887

 

Selling, general and administrative

 

 

3,109

 

 

 

2,881

 

 

 

2,558

 

 

 

8,866

 

 

 

4,853

 

Total

 

 

3,782

 

 

 

3,541

 

 

 

2,883

 

 

 

10,833

 

 

 

5,740

 

Less: Amortization of intangible assets included in opex

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

 

 

 

 

 

 

245

 

 

 

 

 

 

735

 

Selling, general and administrative

 

 

961

 

 

 

961

 

 

 

976

 

 

 

2,883

 

 

 

2,992

 

Total

 

 

961

 

 

 

961

 

 

 

1,221

 

 

 

2,883

 

 

 

3,727

 

Less: S-1 related costs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

813

 

Less: Legal fees - term loan (payment holiday)

 

 

 

 

 

 

 

 

 

 

 

126

 

 

 

 

Less: Acquisition-related costs

 

 

 

 

 

 

 

 

591

 

 

 

1,423

 

 

 

591

 

Less: Diligence expenses

 

 

431

 

 

 

 

 

 

 

 

 

431

 

 

 

 

Non-GAAP operating expenses

 

$

30,462

 

 

$

30,178

 

 

$

24,665

 

 

$

91,890

 

 

$

72,796

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of income from operations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP income from operations

 

$

7,399

 

 

$

22,451

 

 

$

48,694

 

 

$

77,649

 

 

$

125,240

 

GAAP operating margin

 

 

3.1

%

 

 

7.4

%

 

 

14.5

%

 

 

8.3

%

 

 

13.7

%

Add: Share-based compensation expense

 

 

4,433

 

 

 

4,148

 

 

 

3,297

 

 

 

12,636

 

 

 

6,599

 

Add: Amortization of intangible assets

 

 

977

 

 

 

1,059

 

 

 

1,221

 

 

 

3,013

 

 

 

3,727

 

Add: S-1 related costs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

813

 

Add: Legal fees - term loan (payment holiday)

 

 

 

 

 

 

 

 

 

 

 

126

 

 

 

 

Add: Acquisition-related costs

 

 

 

 

 

 

 

 

591

 

 

 

1,423

 

 

 

591

 

Add: Diligence expenses

 

 

431

 

 

 

 

 

 

 

 

 

431

 

 

 

 

Non-GAAP income from operations

 

$

13,240

 

 

$

27,658

 

 

$

53,803

 

 

$

95,278

 

 

$

136,970

 

Non-GAAP operating margin

 

 

5.6

%

 

 

9.1

%

 

 

16.0

%

 

 

10.2

%

 

 

15.0

%

 

 


SMART Global Holdings, Inc.

and Subsidiaries

Reconciliation of Non-GAAP Financial Measures to GAAP Results (continued)

(In thousands, except per share data)

 

  

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

May 31,

2019

 

 

March 1,

2019

 

 

May 25,

2018

 

 

May 31,

2019

 

 

May 25,

2018

 

Reconciliation of income before income taxes:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP income before income taxes

 

$

2,495

 

 

$

17,430

 

 

$

37,451

 

 

$

58,520

 

 

$

105,001

 

Add: Share-based compensation expense

 

 

4,433

 

 

 

4,148

 

 

 

3,297

 

 

 

12,636

 

 

 

6,599

 

Add: Amortization of intangible assets

 

 

977

 

 

 

1,059

 

 

 

1,221

 

 

 

3,013

 

 

 

3,727

 

Add: S-1 related costs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

813

 

Add: Legal fees - term loan (payment holiday)

 

 

 

 

 

 

 

 

 

 

 

126

 

 

 

 

Add: Acquisition-related costs

 

 

 

 

 

 

 

 

591

 

 

 

1,423

 

 

 

591

 

Add: Diligence expenses

 

 

431

 

 

 

 

 

 

 

 

 

431

 

 

 

 

Add: Foreign currency (gains)/losses

 

 

144

 

 

 

(47

)

 

 

6,932

 

 

 

3,481

 

 

 

7,259

 

Non-GAAP income before income taxes

 

$

8,480

 

 

$

22,590

 

 

$

49,492

 

 

$

79,630

 

 

$

123,990

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of provision for income taxes:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP provision for income taxes

 

$

550

 

 

$

4,644

 

 

$

5,505

 

 

$

12,813

 

 

$

15,256

 

GAAP effective tax rate

 

 

22.0

%

 

 

26.6

%

 

 

14.7

%

 

 

21.9

%

 

 

14.5

%

Tax effect of adjustments to GAAP results

 

 

(14

)

 

 

5

 

 

 

(1,025

)

 

 

(347

)

 

 

(1,744

)

Non-GAAP provision for income taxes

 

$

564

 

 

$

4,639

 

 

$

6,530

 

 

$

13,160

 

 

$

17,000

 

Non-GAAP effective tax rate

 

 

6.7

%

 

 

20.5

%

 

 

13.2

%

 

 

16.5

%

 

 

13.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of net income and earnings per share (diluted):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP net income

 

$

1,945

 

 

$

12,786

 

 

$

31,946

 

 

$

45,707

 

 

$

89,745

 

Adjustments to GAAP net income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation

 

 

4,433

 

 

 

4,148

 

 

 

3,297

 

 

 

12,636

 

 

 

6,599

 

Amortization of intangible assets

 

 

977

 

 

 

1,059

 

 

 

1,221

 

 

 

3,013

 

 

 

3,727

 

S-1 related costs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

813

 

Legal fees - term loan (payment holiday)

 

 

 

 

 

 

 

 

 

 

 

126

 

 

 

 

Acquisition-related costs

 

 

 

 

 

 

 

 

591

 

 

 

1,423

 

 

 

591

 

Diligence expenses

 

 

431

 

 

 

 

 

 

 

 

 

431

 

 

 

 

Foreign currency (gains)/losses

 

 

144

 

 

 

(47

)

 

 

6,932

 

 

 

3,481

 

 

 

7,259

 

Tax effect of items excluded from non-GAAP results

 

 

(14

)

 

 

5

 

 

 

(1,025

)

 

 

(347

)

 

 

(1,744

)

Non-GAAP net income

 

$

7,916

 

 

$

17,951

 

 

$

42,962

 

 

$

66,470