Exhibit 99.1
RealPage
Reports Third Quarter 2016 Financial Results
RICHARDSON, Texas--(BUSINESS WIRE)--November 3, 2016--RealPage, Inc.
(NASDAQ:RP), a leading provider of comprehensive property management
software solutions for the multifamily, commercial, single-family and
vacation rental housing industries, today announced financial results
for the third quarter ended September 30, 2016 including total revenue
of $148.0 million, an increase of 22% compared to the third quarter of
2015. Net income for the third quarter of 2016 increased to $4.2
million, or $0.05 per diluted share, compared to a net loss of $8.2
million, or $0.11 per diluted share, in the third quarter of 2015.
Third Quarter 2016 Financial Highlights
-
Non-GAAP total revenue of $147.8 million, an increase of 22%
year-over-year;
-
Adjusted EBITDA of $33.0 million, an increase of 36% year-over-year
and 230 basis points of Adjusted EBITDA margin expansion; and
-
Non-GAAP net income of $15.4 million, or $0.20 in non-GAAP net income
per diluted share, a year-over-year increase of 36% and 33%,
respectively.
Comments on the News
“During the third quarter, RealPage again achieved strong operating
results,” said Steve Winn, Chairman and CEO of RealPage. “Total revenue
growth of 22% was driven primarily by strong subscription revenue growth
of 24%, which represents 90% of total on demand revenue. With each
quarter we get closer to achieving our vision for the rental housing
market – one in which property owners and managers utilize our massive
data repository and comprehensive solutions to fundamentally transform
the operational and transactional elements of their businesses.”
Winn continued, “Our profit performance continues to exceed our
expectations. Adjusted EBITDA margin expanded 230 basis points compared
to the prior year quarter, driven primarily by efficiency gains across
the business combined with ongoing acquisition synergies. As a result of
this focus on efficiency, we are raising our full year 2016 profit
expectations.”
2016 Financial Outlook1
“RealPage continued to deliver strong revenue growth and better than
expected profitability in the third quarter of 2016,” said Bryan Hill,
CFO and Treasurer of RealPage. “As we exit this year, we are confident
in our progress toward our 2020 goal of $1 billion in revenue with a 30%
adjusted EBITDA margin.”
RealPage management expects to achieve the following results during its
calendar year ended December 31, 2016:
-
Non-GAAP total revenue is expected to be in the range of $566.0
million to $569.0 million. This reflects an adjustment for the sale of
certain assets to A Place For Mom® related to the company’s senior
living referral services which were previously expected to contribute
revenue of nearly $1.0 million during the fourth quarter of 2016;
-
Adjusted EBITDA is expected to be in the range of $124.5 million to
$126.0 million, an increase of $1.8 million compared to the midpoint
from the company’s prior outlook provided on August 3, 2016;
-
Non-GAAP net income per diluted share is expected to be in the range
of $0.73 to $0.75, an increase of approximately $0.02 compared to the
midpoint from the company’s prior outlook;
-
Non-GAAP tax rate is expected to be approximately 40 percent; and
-
Weighted average shares outstanding are expected to be approximately
77.9 million.
On October 26, 2016, the company entered into an agreement with A Place
for Mom, Inc. pursuant to which RealPage sold certain assets associated
with its senior living referral services, and the companies agreed to
collaborate to improve lead transparency utilizing the nation’s leading
referral service (A Place for Mom®) and RealPage’s senior living
customer relationship management platform. The purchase price for the
assets was $5.0 million, of which $4.5 million was paid to RealPage at
closing and $0.5 million will be paid to RealPage within 90 days after
closing subject to any claims that may arise under standard
representations and warranties. As a result of the sale, the company
recognized a pre-tax impairment charge of $0.8 million during the third
quarter ended September 30, 2016.
1 Recently, the U.S. Securities and Exchange Commission staff
issued new guidance regarding the use of non-GAAP financial measures.
While the company has reconciled guidance as part of its “Reconciliation
of Non-GAAP Financial Measures to Comparable GAAP Measures” as set forth
in this press release, the company believes that revising the guidance
bullets mid-year during 2016 to present the GAAP equivalent may confuse
our stockholders and the investment community. As a result, the company
plans to present both the non-GAAP financial measure and the applicable
GAAP financial measure in its guidance bullets beginning with the
release of its fiscal year 2017 guidance.
Use of Non-GAAP Financial Measures
In the company’s earnings releases, conference call remarks, slide
presentations, and webcasts, the company may use or discuss non-GAAP
financial measures, as defined by Regulation G. The GAAP financial
measure most directly comparable to each non-GAAP financial measure used
or discussed, and a reconciliation of the differences between each
non-GAAP financial measure and the comparable GAAP financial measure,
are included in this press release. For such non-GAAP reconciliations,
please reference this press release, the Investor Relations section of www.realpage.com,
and the company’s most recent SEC filings.
Conference Call and Webcast
The Company will host a conference call at 5 p.m. EDT today to discuss
its financial results. Participants are encouraged to listen to the
presentation via a live web broadcast at www.realpage.com on the
Investor Relations section. In addition, a live dial-in is available
domestically at 866-807-9684 and internationally at 412-317-5415. A
replay will be available at 877-344-7529 or 412-317-0088, passcode
10095648, until November 10, 2016.
About RealPage
RealPage, Inc. is a leading provider of comprehensive property
management software solutions for the multifamily, commercial,
single-family and vacation rental housing industries. These solutions
help property owners increase efficiency, decrease expenses, enhance the
resident experience and generate more revenue. Using its innovative SaaS
platform, RealPage's on demand software enables easy system integration
and streamlines online property management. Its product line covers the
full spectrum of property management, leasing and marketing, asset
optimization, and resident services solutions. Founded in 1998 and
headquartered in Richardson, Texas, RealPage currently serves over
12,000 clients worldwide from offices in North America, Europe and Asia.
For more information about the company, visit http://www.realpage.com.
Cautionary Statement Regarding Forward-Looking Statements
This press release contains “forward-looking” statements relating
to RealPage, Inc.’s expected, possible or assumed future results and
RealPage’s long-term revenue and adjusted EBITDA margin goals. These
forward-looking statements are based on management's beliefs and
assumptions and on information currently available to management.
Forward-looking statements include all statements that are not
historical facts and may be identified by terms such as “expects,”
“believes,” “plans,” or similar expressions and the negatives of those
terms. Those forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause actual results,
performance or achievements to be materially different from any future
results, performance or achievements expressed or implied by the
forward-looking statements. The company may be required to revise its
results upon finalizing its review of quarterly and full year results,
which could cause or contribute to such differences. Additional factors
that could cause or contribute to such differences include, but are not
limited to, the following: (a) the possibility that general economic
conditions, including leasing velocity or uncertainty, could cause
information technology spending, particularly in the rental housing
industry, to be reduced or purchasing decisions to be delayed; (b) an
increase in insurance claims; (c) an increase in customer cancellations;
(d) the inability to increase sales to existing customers and to attract
new customers; (e) RealPage, Inc.’s failure to integrate acquired
businesses and any future acquisitions successfully or to achieve
expected synergies; (f) the timing and success of new product
introductions by RealPage, Inc. or its competitors; (g) changes
in RealPage, Inc.’s pricing policies or those of its competitors; (h)
legal or regulatory proceedings; (i) the inability to achieve revenue
growth or to enable margin expansion; and (j) such other risks and
uncertainties described more fully in documents filed with or furnished
to the Securities and Exchange Commission (“SEC”) by RealPage Inc.,
including its Quarterly Report on Form 10-Q previously filed with
the SEC on August 3, 2016. All information provided in this release is
as of the date hereof and RealPage Inc. undertakes no duty to update
this information except as required by law.
Explanation of Non-GAAP Financial Measures
The company reports its financial results in accordance with accounting
principles generally accepted in the United States of America, or GAAP.
However, the company believes that, in order to properly understand its
short-term and long-term financial, operational and strategic trends, it
may be helpful for investors to exclude certain non-cash or
non-recurring items when used as a supplement to financial performance
measures in accordance with GAAP. These non-cash or non-recurring items
result from facts and circumstances that vary in both frequency and
impact on continuing operations. The company also uses results of
operations excluding such items to evaluate the operating performance of
RealPage and compare it against prior periods, make operating decisions,
determine executive compensation, and serve as a basis for long-term
strategic planning. These non-GAAP financial measures provide the
company with additional means to understand and evaluate the operating
results and trends in its ongoing business by eliminating certain
non-cash expenses and other items that RealPage believes might otherwise
make comparisons of its ongoing business with prior periods more
difficult, obscure trends in ongoing operations, reduce management’s
ability to make useful forecasts, or obscure the ability to evaluate the
effectiveness of certain business strategies and management incentive
structures. In addition, the company also believes that investors and
financial analysts find this information to be helpful in analyzing the
company’s financial and operational performance and comparing this
performance to the company’s peers and competitors.
The company defines “Non-GAAP Total Revenue” as total revenue plus
acquisition-related and other deferred revenue adjustments. The company
believes it is useful to include deferred revenue written down for GAAP
purposes under purchase accounting rules and revenue deferred due to a
lack of historical experience determining the settlement of the
contractual obligation in order to appropriately measure the underlying
performance of its business operations in the period of activity and
associated expense. Further, the company believes this measure is useful
to investors as a way to evaluate the company’s ongoing performance
because it provides a more accurate depiction of on demand revenue
arising from our strategic acquisitions.
The company defines “Adjusted Gross Profit” as gross profit, plus (1)
acquisition-related and other deferred revenue adjustments, (2)
depreciation, (3) amortization of intangible assets, (4) headquarters
relocation costs, and (5) stock-based expense; and the company defines
“Adjusted Gross Margin” as Adjusted Gross Profit as a percentage of
Non-GAAP Total Revenue. The company believes that investors and
financial analysts find these non-GAAP financial measures to be useful
in analyzing the company’s financial and operational performance,
comparing this performance to the company’s peers and competitors, and
understanding the company’s ability to generate income from ongoing
business operations.
The company defines “Adjusted EBITDA” as net income (loss), plus (1)
acquisition-related and other deferred revenue adjustments, (2)
depreciation, asset impairment, and the loss on disposal of assets, (3)
amortization of intangible assets, (4) acquisition-related expense
(income), (5) interest expense, net, (6) income tax expense (benefit),
(7) litigation-related expense, (8) headquarters relocation costs, and
(9) stock-based expense; and the company defines “Adjusted EBITDA
Margin” as Adjusted EBITDA as a percentage Non-GAAP Total Revenue. The
company believes that investors and financial analysts find these
non-GAAP financial measures to be useful in analyzing the company’s
financial and operational performance, comparing this performance to the
company’s peers and competitors, and understanding the company’s ability
to generate income from ongoing business operations.
The company defines “Non-GAAP Product Development Expense” as product
development expense, excluding (1) asset impairment and loss on disposal
of assets, (2) headquarters relocation costs, and (3) stock-based
expense; and the company defines “Non-GAAP Product Development Margin”
as Non-GAAP Product Development Expense as a percentage of Non-GAAP
Total Revenue. The company believes that investors and financial
analysts find these non-GAAP financial measures to be useful in
analyzing the company’s financial and operational performance, comparing
this performance to the company’s peers and competitors, and
understanding the company’s ongoing expenditures related to product
innovation.
The company defines “Non-GAAP Sales and Marketing Expense” as sales and
marketing expense, excluding (1) amortization of intangible assets, (2)
headquarters relocation costs, and (3) stock-based expense; and the
company defines “Non-GAAP Sales and Marketing Margin” as Non-GAAP Sales
and Marketing Expense as a percentage of Non-GAAP Total Revenue. The
company believes that investors and financial analysts find these
non-GAAP financial measures to be useful in analyzing the company’s
financial and operational performance, comparing this performance to the
company’s peers and competitors, and understanding the company’s ongoing
expenditures related to its sales and marketing strategies.
The company defines “Non-GAAP General and Administrative Expense” as
general and administrative expense, excluding (1) asset impairment and
loss on disposal of assets, (2) acquisition-related expense (income),
(3) litigation-related expense, (4) headquarters relocation costs, and
(5) stock-based expense; and the company defines “Non-GAAP General and
Administrative Margin” as Non-GAAP General and Administrative Expense as
a percentage of Non-GAAP Total Revenue. The company believes that
investors and financial analysts find these non-GAAP financial measures
to be useful in analyzing the company’s financial and operational
performance, comparing this performance to the company’s peers and
competitors, and understanding the company’s underlying expense
structure to support corporate activities and processes.
The company defines “Non-GAAP Operating Expense” as operating expense,
excluding (1) asset impairment and loss on disposal of assets, (2)
acquisition-related expense (income), (3) litigation-related expense,
(4) headquarters relocation costs, and (5) stock-based expense; and the
company defines “Non-GAAP Operating Expense Margin” as Non-GAAP
Operating Expense as a percentage of Non-GAAP Total Revenue. The company
believes that investors and financial analysts find these non-GAAP
financial measures to be useful in analyzing the company’s financial and
operational performance, comparing this performance to the company’s
peers and competitors, and understanding the company’s underlying
expense structure to support ongoing operations.
The company defines “Non-GAAP Operating Income” as operating income
(loss), plus (1) acquisition-related and other deferred revenue, (2)
asset impairment and loss on disposal of assets, (3) amortization of
intangible assets, (4) acquisition-related expense (income), (5)
litigation-related expense, (6) headquarters relocation costs, and (7)
stock-based expense; and the company defines “Non-GAAP Operating Margin”
as Non-GAAP Operating Income as a percentage of Non-GAAP Total Revenue.
The company believes that investors and financial analysts find these
non-GAAP financial measures to be useful in analyzing the company’s
financial and operational performance, comparing this performance to the
company’s peers and competitors, and understanding the company’s ability
to generate income from ongoing business operations.
The company defines “Non-GAAP Net Income” as net income (loss), plus (1)
income tax expense, (2) acquisition-related and other deferred revenue,
(3) asset impairment and loss on disposal of assets, (4) amortization of
intangible assets, (5) acquisition-related expense (income), (6)
litigation-related expense, (7) headquarters relocation costs, (8)
stock-based expense, and (9) provision for income tax expense based on
an assumed rate in order to approximate the company’s long-term
effective corporate tax rate; and the company defines “Non-GAAP Net
Income per Diluted Share” as Non-GAAP Net Income divided by weighted
average diluted shares outstanding. The company believes that investors
and financial analysts find these non-GAAP financial measures to be
useful in analyzing the company’s financial and operational performance,
comparing this performance to the company’s peers and competitors, and
understanding the company’s ability to generate income from ongoing
business operations.
The company defines “Non-GAAP On Demand Revenue” as total revenue plus
acquisition-related and other deferred revenue adjustments. The company
believes it is useful to include deferred revenue written down for GAAP
purposes under purchase accounting rules and revenue deferred due to a
lack of historical experience determining the settlement of the
contractual obligation in order to appropriately measure the underlying
performance of the company’s business operations in the period of
activity and associated expense. Further, the company believes that
investors and financial analysts find this measure to be useful in
evaluating the company’s ongoing performance because it provides a more
accurate depiction of on demand revenue arising from our strategic
acquisitions.
The company defines “Ending On Demand Units” as the number of rental
housing units managed by our customers with one or more of our on demand
software solutions at the end of the period. We use ending on demand
units to measure the success of our strategy of increasing the number of
rental housing units managed with our on demand software solutions.
Property unit counts are provided to us by our customers as new sales
orders are processed. Property unit counts may be adjusted periodically
as information related to our customers’ properties is updated or
supplemented, which could result in adjustments to the number of units
previously reported.
The company defines “RPU,” or Revenue Per Unit, as Non-GAAP On Demand
Revenue divided by average on demand units for the same period. For
interim periods, the calculation is performed on an annualized basis.
The company calculates average on demand units as the average of the
beginning and ending on demand units for each quarter in the period
presented. The company monitors this metric to measure its success in
increasing the number of on demand software solutions utilized by its
customers to manage their rental housing units, its overall revenue and
profitability.
The company defines “ACV,” or Annual Client Value, as RPU multiplied by
Ending On Demand Units. The company monitors this metric to measure its
success in increasing the number of on demand units and the amount of
software solutions utilized by its customers to manage their rental
housing units. In addition, the company believes ACV provides a useful
proxy for the annual run-rate value of on demand customer relationships.
The company excludes or adjusts each of the items identified below from
the applicable non-GAAP financial measure referenced above for the
reasons set forth with respect to each excluded item:
-
Non-GAAP tax rate – The company uses a non-GAAP tax rate of 40%
to normalize the tax impact to its Non-GAAP Adjusted Net Income per
Diluted Share based on the fact that a relatively small change in
pre-tax GAAP income (loss) in any one period could result in a
volatile GAAP effective tax rate.
-
Acquisition-related and other deferred revenue – These items
are included to reflect deferred revenue written down for GAAP
purposes under purchase accounting rules and revenue deferred due to a
lack of historical experience determining the settlement of the
contractual obligation in order to appropriately measure the
underlying performance of the company’s business operations in the
period of activity and associated expense.
-
Asset impairment and loss on disposal of assets – These items
comprise gains (losses) on the disposal and impairment of long-lived
assets, which are not reflective of the company’s ongoing operations.
We believe exclusion of these items facilitates a more accurate
comparison of the company’s results of operations between periods.
-
Amortization of intangible assets – These items are amortized
over their estimated useful lives and generally cannot be changed or
influenced by the company after acquisition. Accordingly, these items
are not considered by the company in making operating decisions. The
company does not believe such charges accurately reflect the
performance of its ongoing operations for the period in which such
charges are incurred.
-
Acquisition-related expense (income) – These items consist of
direct costs incurred in our business acquisition transactions and the
impact of changes in the fair value of acquisition-related contingent
consideration obligations. We believe exclusion of these items
facilitates a more accurate comparison of the results of the company’s
ongoing operations across periods and eliminates volatility related to
changes in the fair value of acquisition-related contingent
consideration obligations.
-
Litigation-related expense – This item relates to the company's
litigation with Yardi Systems, Inc., including related insurance
litigation and settlement costs. This significant and non-recurring
litigation and related ancillary matters were resolved in the second
quarter of 2014. The company believes that the costs incurred related
to this litigation are not reflective of its ongoing operations.
-
Headquarters relocation costs – These items consist of
duplicative rent and other expenses related to the relocation of our
corporate headquarters and data center. These costs are not reflective
of the company’s ongoing operations due to their non-recurring nature.
-
Stock-based expense – This item is excluded because these are
non-cash expenditures that the company does not consider part of
ongoing operating results when assessing the performance of our
business, and also because the total amount of the expenditure is
partially outside of its control because it is based on factors such
as stock price, volatility, and interest rates, which may be unrelated
to the company’s performance during the period in which the expenses
are incurred.
|
|
|
Condensed Consolidated Balance Sheets
|
|
(in thousands, except share amounts)
|
|
|
|
|
|
|
|
|
|
September 30,
|
|
|
December 31,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
$
|
69,090
|
|
|
|
$
|
30,911
|
|
|
Restricted cash
|
|
|
|
|
92,284
|
|
|
|
|
85,461
|
|
|
Accounts receivable, less allowance for doubtful accounts of $3,308
and $2,318 at September 30, 2016 and December 31, 2015, respectively
|
|
|
|
|
83,444
|
|
|
|
|
74,192
|
|
|
Prepaid expenses
|
|
|
|
|
11,286
|
|
|
|
|
8,294
|
|
|
Other current assets
|
|
|
|
|
7,866
|
|
|
|
|
23,085
|
|
|
Total current assets
|
|
|
|
|
263,970
|
|
|
|
|
221,943
|
|
|
Property, equipment, and software, net
|
|
|
|
|
122,119
|
|
|
|
|
82,198
|
|
|
Goodwill
|
|
|
|
|
261,768
|
|
|
|
|
220,097
|
|
|
Identified intangible assets, net
|
|
|
|
|
84,579
|
|
|
|
|
81,280
|
|
|
Deferred tax assets, net
|
|
|
|
|
15,456
|
|
|
|
|
12,051
|
|
|
Other assets
|
|
|
|
|
8,642
|
|
|
|
|
5,632
|
|
|
Total assets
|
|
|
|
$
|
756,534
|
|
|
|
$
|
623,201
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and stockholders’ equity
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
|
|
$
|
20,041
|
|
|
|
$
|
17,448
|
|
|
Accrued expenses and other current liabilities
|
|
|
|
|
44,201
|
|
|
|
|
28,294
|
|
|
Current portion of deferred revenue
|
|
|
|
|
81,852
|
|
|
|
|
84,200
|
|
|
Current portion of term loan, net
|
|
|
|
|
4,688
|
|
|
|
|
—
|
|
|
Client deposits held in restricted accounts
|
|
|
|
|
92,207
|
|
|
|
|
85,405
|
|
|
Total current liabilities
|
|
|
|
|
242,989
|
|
|
|
|
215,347
|
|
|
Deferred revenue
|
|
|
|
|
6,582
|
|
|
|
|
6,979
|
|
|
Revolving line of credit
|
|
|
|
|
—
|
|
|
|
|
40,000
|
|
|
Term loan, net
|
|
|
|
|
118,167
|
|
|
|
|
—
|
|
|
Other long-term liabilities
|
|
|
|
|
35,288
|
|
|
|
|
34,423
|
|
|
Total liabilities
|
|
|
|
|
403,026
|
|
|
|
|
296,749
|
|
|
Stockholders’ equity:
|
|
|
|
|
|
|
|
|
Preferred stock, $0.001 par value: 10,000,000 shares authorized and
zero shares issued and outstanding at September 30, 2016 and
December 31, 2015, respectively
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
Common stock, $0.001 par value: 125,000,000 shares authorized,
85,412,054 and 82,919,033 shares issued and 80,565,811 and
78,793,670 shares outstanding at September 30, 2016 and December 31,
2015, respectively
|
|
|
|
|
85
|
|
|
|
|
83
|
|
|
Additional paid-in capital
|
|
|
|
|
508,756
|
|
|
|
|
471,668
|
|
|
Treasury stock, at cost: 4,846,243 and 4,125,363 shares at September
30, 2016 and December 31, 2015, respectively
|
|
|
|
|
(28,117
|
)
|
|
|
|
(24,338
|
)
|
|
Accumulated deficit
|
|
|
|
|
(126,621
|
)
|
|
|
|
(120,415
|
)
|
|
Accumulated other comprehensive loss
|
|
|
|
|
(595
|
)
|
|
|
|
(546
|
)
|
|
Total stockholders’ equity
|
|
|
|
|
353,508
|
|
|
|
|
326,452
|
|
|
Total liabilities and stockholders’ equity
|
|
|
|
$
|
756,534
|
|
|
|
$
|
623,201
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated Statements of Operations
|
|
(in thousands, except per share amounts)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
On demand
|
|
|
|
$
|
140,883
|
|
|
|
$
|
116,772
|
|
|
|
$
|
400,904
|
|
|
|
$
|
333,872
|
|
|
On premise
|
|
|
|
|
682
|
|
|
|
|
834
|
|
|
|
|
2,141
|
|
|
|
|
2,301
|
|
|
Professional and other
|
|
|
|
|
6,390
|
|
|
|
|
3,982
|
|
|
|
|
16,012
|
|
|
|
|
10,647
|
|
|
Total revenue
|
|
|
|
|
147,955
|
|
|
|
|
121,588
|
|
|
|
|
419,057
|
|
|
|
|
346,820
|
|
|
Cost of revenue(1) (2)
|
|
|
|
|
64,111
|
|
|
|
|
51,740
|
|
|
|
|
180,937
|
|
|
|
|
147,795
|
|
|
Gross profit
|
|
|
|
|
83,844
|
|
|
|
|
69,848
|
|
|
|
|
238,120
|
|
|
|
|
199,025
|
|
|
Operating expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product development(1)
|
|
|
|
|
18,743
|
|
|
|
|
16,858
|
|
|
|
|
54,893
|
|
|
|
|
52,919
|
|
|
Sales and marketing(1) (2)
|
|
|
|
|
33,860
|
|
|
|
|
32,698
|
|
|
|
|
101,188
|
|
|
|
|
92,698
|
|
|
General and administrative(1)
|
|
|
|
|
21,677
|
|
|
|
|
13,424
|
|
|
|
|
61,955
|
|
|
|
|
51,797
|
|
|
Impairment of identified intangible assets
|
|
|
|
|
750
|
|
|
|
|
20,274
|
|
|
|
|
750
|
|
|
|
|
20,801
|
|
|
Total operating expense
|
|
|
|
|
75,030
|
|
|
|
|
83,254
|
|
|
|
|
218,786
|
|
|
|
|
218,215
|
|
|
Operating income (loss)
|
|
|
|
|
8,814
|
|
|
|
|
(13,406
|
)
|
|
|
|
19,334
|
|
|
|
|
(19,190
|
)
|
|
Interest expense and other, net
|
|
|
|
|
(1,064
|
)
|
|
|
|
(391
|
)
|
|
|
|
(2,846
|
)
|
|
|
|
(1,048
|
)
|
|
Income (loss) before income taxes
|
|
|
|
|
7,750
|
|
|
|
|
(13,797
|
)
|
|
|
|
16,488
|
|
|
|
|
(20,238
|
)
|
|
Income tax expense (benefit)
|
|
|
|
|
3,540
|
|
|
|
|
(5,605
|
)
|
|
|
|
7,199
|
|
|
|
|
(7,120
|
)
|
|
Net income (loss)
|
|
|
|
$
|
4,210
|
|
|
|
$
|
(8,192
|
)
|
|
|
$
|
9,289
|
|
|
|
$
|
(13,118
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share attributable to common stockholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
$
|
0.05
|
|
|
|
$
|
(0.11
|
)
|
|
|
$
|
0.12
|
|
|
|
$
|
(0.17
|
)
|
|
Diluted
|
|
|
|
$
|
0.05
|
|
|
|
$
|
(0.11
|
)
|
|
|
$
|
0.12
|
|
|
|
$
|
(0.17
|
)
|
|
Weighted average shares used in computing net income (loss) per
share attributable to common stockholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
76,823
|
|
|
|
|
76,564
|
|
|
|
|
76,615
|
|
|
|
|
76,772
|
|
|
Diluted
|
|
|
|
|
78,124
|
|
|
|
|
76,564
|
|
|
|
|
77,525
|
|
|
|
|
76,772
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Includes stock-based expense as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Cost of revenue
|
|
|
|
$
|
929
|
|
|
|
$
|
817
|
|
|
|
$
|
2,506
|
|
|
|
$
|
3,267
|
|
|
Product development
|
|
|
|
|
1,900
|
|
|
|
|
1,759
|
|
|
|
|
5,246
|
|
|
|
|
7,050
|
|
|
Sales and marketing
|
|
|
|
|
1,406
|
|
|
|
|
3,118
|
|
|
|
|
8,179
|
|
|
|
|
10,750
|
|
|
General and administrative
|
|
|
|
|
4,020
|
|
|
|
|
2,975
|
|
|
|
|
11,452
|
|
|
|
|
9,599
|
|
|
|
|
|
|
$
|
8,255
|
|
|
|
$
|
8,669
|
|
|
|
$
|
27,383
|
|
|
|
$
|
30,666
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) Certain amounts in the prior year periods have been
reclassified to conform with current period presentation.
|
|
|
|
|
|
Condensed Consolidated Statements of Cash Flows
|
|
(in thousands)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
|
|
$
|
4,210
|
|
|
|
$
|
(8,192
|
)
|
|
|
$
|
9,289
|
|
|
|
$
|
(13,118
|
)
|
|
Adjustments to reconcile net income (loss) to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
|
|
14,052
|
|
|
|
|
11,913
|
|
|
|
|
40,874
|
|
|
|
|
33,787
|
|
|
Deferred taxes
|
|
|
|
|
3,104
|
|
|
|
|
(7,173
|
)
|
|
|
|
5,424
|
|
|
|
|
(8,827
|
)
|
|
Stock-based expense
|
|
|
|
|
8,255
|
|
|
|
|
8,669
|
|
|
|
|
27,383
|
|
|
|
|
30,666
|
|
|
Excess tax benefit from stock-based compensation
|
|
|
|
|
—
|
|
|
|
|
331
|
|
|
|
|
—
|
|
|
|
|
968
|
|
|
Loss on disposal and impairment of other long-lived assets
|
|
|
|
|
914
|
|
|
|
|
20,966
|
|
|
|
|
999
|
|
|
|
|
23,769
|
|
|
Acquisition-related consideration
|
|
|
|
|
(248
|
)
|
|
|
|
(3,511
|
)
|
|
|
|
(499
|
)
|
|
|
|
(3,018
|
)
|
|
Changes in assets and liabilities, net of assets acquired and
liabilities assumed in business combinations
|
|
|
|
|
14,236
|
|
|
|
|
(3,283
|
)
|
|
|
|
21,654
|
|
|
|
|
4,287
|
|
|
Net cash provided by operating activities
|
|
|
|
|
44,523
|
|
|
|
|
19,720
|
|
|
|
|
105,124
|
|
|
|
|
68,514
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of property, equipment, and software
|
|
|
|
|
(22,519
|
)
|
|
|
|
(7,536
|
)
|
|
|
|
(61,005
|
)
|
|
|
|
(18,784
|
)
|
|
Proceeds from disposal of property, equipment, and software
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
305
|
|
|
Acquisition of businesses, net of cash acquired
|
|
|
|
|
(95
|
)
|
|
|
|
—
|
|
|
|
|
(71,400
|
)
|
|
|
|
(45,450
|
)
|
|
Purchase of cost-method investment
|
|
|
|
|
(3,000
|
)
|
|
|
|
—
|
|
|
|
|
(3,000
|
)
|
|
|
|
—
|
|
|
Net cash used in investing activities
|
|
|
|
|
(25,614
|
)
|
|
|
|
(7,536
|
)
|
|
|
|
(135,405
|
)
|
|
|
|
(63,929
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payments on and proceeds from debt, net
|
|
|
|
|
(905
|
)
|
|
|
|
(6,143
|
)
|
|
|
|
82,184
|
|
|
|
|
23,563
|
|
|
Payments of acquisition-related consideration
|
|
|
|
|
(2,140
|
)
|
|
|
|
(875
|
)
|
|
|
|
(4,876
|
)
|
|
|
|
(2,109
|
)
|
|
Issuance of common stock
|
|
|
|
|
8,131
|
|
|
|
|
1,431
|
|
|
|
|
16,139
|
|
|
|
|
2,900
|
|
|
Excess tax benefit from stock-based compensation
|
|
|
|
|
—
|
|
|
|
|
(331
|
)
|
|
|
|
—
|
|
|
|
|
(968
|
)
|
|
Purchase of treasury stock related to stock-based compensation
|
|
|
|
|
(1,600
|
)
|
|
|
|
(1,682
|
)
|
|
|
|
(3,779
|
)
|
|
|
|
(5,619
|
)
|
|
Purchase of treasury stock under share repurchase program
|
|
|
|
|
—
|
|
|
|
|
(15,309
|
)
|
|
|
|
(21,244
|
)
|
|
|
|
(30,455
|
)
|
|
Net cash provided by (used in) financing activities
|
|
|
|
|
3,486
|
|
|
|
|
(22,909
|
)
|
|
|
|
68,424
|
|
|
|
|
(12,688
|
)
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
|
|
22,395
|
|
|
|
|
(10,725
|
)
|
|
|
|
38,143
|
|
|
|
|
(8,103
|
)
|
|
Effect of exchange rate on cash
|
|
|
|
|
7
|
|
|
|
|
(31
|
)
|
|
|
|
36
|
|
|
|
|
(267
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning of period
|
|
|
|
|
46,688
|
|
|
|
|
29,322
|
|
|
|
|
30,911
|
|
|
|
|
26,936
|
|
|
End of period
|
|
|
|
$
|
69,090
|
|
|
|
$
|
18,566
|
|
|
|
$
|
69,090
|
|
|
|
$
|
18,566
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO
|
|
COMPARABLE GAAP MEASURES
|
|
(Unaudited, in thousands, except per share amounts)
|
|
|
The following is a reconciliation of the non-GAAP financial measures
used by RealPage to describe its financial results determined in
accordance with accounting principles generally accepted in the United
States of America, or GAAP. An explanation of these measures is also
included under the heading “Explanation of Non-GAAP Financial Measures.”
While the company believes that these non-GAAP financial measures
provide useful supplemental information to investors regarding the
underlying performance of our business operations, investors are
reminded to consider these non-GAAP measures in addition to, and not as
a substitute for, financial performance measures prepared in accordance
with GAAP. In addition, it should be noted that these non-GAAP financial
measures may be different from non-GAAP measures used by other
companies, and the company may utilize other measures to illustrate
performance in the future. Non-GAAP measures have limitations in that
they do not reflect all of the amounts associated with our results of
operations as determined in accordance with GAAP.
|
|
|
Non-GAAP Total Revenue
|
|
Set forth below is a presentation of the company’s “Non-GAAP Total
Revenue.” Please reference the “Explanation of Non-GAAP Financial
Measures” section.
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Revenue (GAAP)
|
|
|
|
$
|
147,955
|
|
|
|
$
|
121,588
|
|
|
|
$
|
419,057
|
|
|
|
$
|
346,820
|
|
|
Acquisition-related and other deferred revenue
|
|
|
|
|
(161
|
)
|
|
|
|
(614
|
)
|
|
|
|
(762
|
)
|
|
|
|
(1,612
|
)
|
|
Non-GAAP Total Revenue
|
|
|
|
$
|
147,794
|
|
|
|
$
|
120,974
|
|
|
|
$
|
418,295
|
|
|
|
$
|
345,208
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Gross Margin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Set forth below is a presentation of the company’s "Adjusted Gross
Profit" and "Adjusted Gross Margin." Please reference the
"Explanation of Non-GAAP Financial Measures" section.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Gross profit (GAAP) (1)
|
|
|
|
$
|
83,844
|
|
|
|
$
|
69,848
|
|
|
|
$
|
238,120
|
|
|
|
$
|
199,025
|
|
|
Acquisition-related and other deferred revenue
|
|
|
|
|
(161
|
)
|
|
|
|
(614
|
)
|
|
|
|
(762
|
)
|
|
|
|
(1,612
|
)
|
|
Depreciation
|
|
|
|
|
2,834
|
|
|
|
|
2,431
|
|
|
|
|
8,580
|
|
|
|
|
7,269
|
|
|
Amortization of intangible assets
|
|
|
|
|
4,296
|
|
|
|
|
4,052
|
|
|
|
|
12,602
|
|
|
|
|
10,142
|
|
|
Headquarters relocation costs
|
|
|
|
|
760
|
|
|
|
|
—
|
|
|
|
|
2,023
|
|
|
|
|
—
|
|
|
Stock-based expense
|
|
|
|
|
929
|
|
|
|
|
817
|
|
|
|
|
2,506
|
|
|
|
|
3,267
|
|
|
Adjusted Gross Profit
|
|
|
|
$
|
92,502
|
|
|
|
$
|
76,534
|
|
|
|
$
|
263,069
|
|
|
|
$
|
218,091
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Gross Margin
|
|
|
|
|
62.6
|
%
|
|
|
|
63.3
|
%
|
|
|
|
62.9
|
%
|
|
|
|
63.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
Set forth below is a presentation of the company’s "Adjusted EBITDA"
and "Adjusted EBITDA Margin." Please reference the "Explanation of
Non-GAAP Financial Measures" section.
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Net income (loss) (GAAP)
|
|
|
|
$
|
4,210
|
|
|
|
$
|
(8,192
|
)
|
|
|
$
|
9,289
|
|
|
|
$
|
(13,118
|
)
|
|
Acquisition-related and other deferred revenue
|
|
|
|
|
(161
|
)
|
|
|
|
(614
|
)
|
|
|
|
(762
|
)
|
|
|
|
(1,612
|
)
|
|
Depreciation, asset impairment, and loss on disposal of assets
|
|
|
|
|
7,119
|
|
|
|
|
25,952
|
|
|
|
|
19,178
|
|
|
|
|
38,970
|
|
|
Amortization of intangible assets
|
|
|
|
|
7,847
|
|
|
|
|
6,927
|
|
|
|
|
22,695
|
|
|
|
|
18,586
|
|
|
Acquisition-related income
|
|
|
|
|
(266
|
)
|
|
|
|
(3,310
|
)
|
|
|
|
(332
|
)
|
|
|
|
(1,653
|
)
|
|
Interest expense, net
|
|
|
|
|
1,079
|
|
|
|
|
391
|
|
|
|
|
2,888
|
|
|
|
|
966
|
|
|
Income tax expense (benefit)
|
|
|
|
|
3,540
|
|
|
|
|
(5,605
|
)
|
|
|
|
7,199
|
|
|
|
|
(7,120
|
)
|
|
Litigation-related expense
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
2
|
|
|
Headquarters relocation costs
|
|
|
|
|
1,353
|
|
|
|
|
—
|
|
|
|
|
3,552
|
|
|
|
|
—
|
|
|
Stock-based expense
|
|
|
|
|
8,255
|
|
|
|
|
8,669
|
|
|
|
|
27,383
|
|
|
|
|
30,666
|
|
|
Adjusted EBITDA
|
|
|
|
$
|
32,976
|
|
|
|
$
|
24,218
|
|
|
|
$
|
91,090
|
|
|
|
$
|
65,687
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA Margin
|
|
|
|
|
22.3
|
%
|
|
|
|
20.0
|
%
|
|
|
|
21.8
|
%
|
|
|
|
19.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Product Development Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Set forth below is a presentation of the company’s "Non-GAAP Product
Development Expense" and "Non-GAAP Product Development Margin."
Please reference the "Explanation of Non-GAAP Financial Measures"
section.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Product development expense (GAAP)
|
|
|
|
$
|
18,743
|
|
|
|
$
|
16,858
|
|
|
|
$
|
54,893
|
|
|
|
$
|
52,919
|
|
|
Less:
|
|
Asset impairment and loss on disposal of assets
|
|
|
|
|
—
|
|
|
|
|
532
|
|
|
|
|
—
|
|
|
|
|
1,333
|
|
|
|
|
Headquarters relocation costs
|
|
|
|
|
211
|
|
|
|
|
—
|
|
|
|
|
541
|
|
|
|
|
—
|
|
|
|
|
Stock-based expense
|
|
|
|
|
1,900
|
|
|
|
|
1,759
|
|
|
|
|
5,246
|
|
|
|
|
7,050
|
|
|
Non-GAAP Product Development Expense
|
|
|
|
$
|
16,632
|
|
|
|
$
|
14,567
|
|
|
|
$
|
49,106
|
|
|
|
$
|
44,536
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Product Development Margin
|
|
|
|
|
11.3
|
%
|
|
|
|
12.0
|
%
|
|
|
|
11.7
|
%
|
|
|
|
12.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Sales and Marketing Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Set forth below is a presentation of the company’s "Non-GAAP Sales
and Marketing Expense" and "Non-GAAP Sales and Marketing Margin."
Please reference the "Explanation of Non-GAAP Financial Measures"
section.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Sales and marketing expense (GAAP) (1)
|
|
|
|
$
|
33,860
|
|
|
|
$
|
32,698
|
|
|
|
$
|
101,188
|
|
|
|
$
|
92,698
|
|
|
Less:
|
|
Amortization of intangible assets
|
|
|
|
|
3,551
|
|
|
|
|
2,875
|
|
|
|
|
10,093
|
|
|
|
|
8,444
|
|
|
|
|
Headquarters relocation costs
|
|
|
|
|
220
|
|
|
|
|
—
|
|
|
|
|
574
|
|
|
|
|
—
|
|
|
|
|
Stock-based expense
|
|
|
|
|
1,406
|
|
|
|
|
3,118
|
|
|
|
|
8,179
|
|
|
|
|
10,750
|
|
|
Non-GAAP Sales and Marketing Expense
|
|
|
|
$
|
28,683
|
|
|
|
$
|
26,705
|
|
|
|
$
|
82,342
|
|
|
|
$
|
73,504
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Sales and Marketing Margin
|
|
|
|
|
19.4
|
%
|
|
|
|
22.1
|
%
|
|
|
|
19.7
|
%
|
|
|
|
21.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP General and Administrative Expense
|
|
Set forth below is a presentation of the company’s "Non-GAAP General
and Administrative Expense" and "Non-GAAP General and Administrative
Margin." Please reference the "Explanation of Non-GAAP Financial
Measures" section.
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
General and administrative expense (GAAP)
|
|
|
|
$
|
21,677
|
|
|
|
$
|
13,424
|
|
|
|
$
|
61,955
|
|
|
|
$
|
51,797
|
|
|
Less:
|
|
Asset impairment and loss on disposal of assets
|
|
|
|
|
164
|
|
|
|
|
160
|
|
|
|
|
249
|
|
|
|
|
1,635
|
|
|
|
|
Acquisition-related income
|
|
|
|
|
(266
|
)
|
|
|
|
(3,310
|
)
|
|
|
|
(332
|
)
|
|
|
|
(1,653
|
)
|
|
|
|
Litigation-related expense
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
2
|
|
|
|
|
Headquarters relocation costs
|
|
|
|
|
162
|
|
|
|
|
—
|
|
|
|
|
414
|
|
|
|
|
—
|
|
|
|
|
Stock-based expense
|
|
|
|
|
4,020
|
|
|
|
|
2,975
|
|
|
|
|
11,452
|
|
|
|
|
9,599
|
|
|
Non-GAAP General and Administrative Expense
|
|
|
|
$
|
17,597
|
|
|
|
$
|
13,599
|
|
|
|
$
|
50,172
|
|
|
|
$
|
42,214
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP General and Administrative Margin
|
|
|
|
|
11.9
|
%
|
|
|
|
11.2
|
%
|
|
|
|
12.0
|
%
|
|
|
|
12.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Operating Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Set forth below is a presentation of the company’s "Non-GAAP
Operating Expense" and "Non-GAAP Operating Expense Margin." Please
reference the "Explanation of Non-GAAP Financial Measures" section.
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Operating expense (GAAP) (1)
|
|
|
|
$
|
75,030
|
|
|
|
$
|
83,254
|
|
|
|
$
|
218,786
|
|
|
|
$
|
218,215
|
|
|
Less:
|
|
Asset impairment and loss on disposal of assets
|
|
|
|
|
914
|
|
|
|
|
20,966
|
|
|
|
|
999
|
|
|
|
|
23,769
|
|
|
|
|
Amortization of intangible assets
|
|
|
|
|
3,551
|
|
|
|
|
2,875
|
|
|
|
|
10,093
|
|
|
|
|
8,444
|
|
|
|
|
Acquisition-related income
|
|
|
|
|
(266
|
)
|
|
|
|
(3,310
|
)
|
|
|
|
(332
|
)
|
|
|
|
(1,653
|
)
|
|
|
|
Litigation-related expense
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
2
|
|
|
|
|
Headquarters relocation costs
|
|
|
|
|
593
|
|
|
|
|
—
|
|
|
|
|
1,529
|
|
|
|
|
—
|
|
|
|
|
Stock-based expense
|
|
|
|
|
7,326
|
|
|
|
|
7,852
|
|
|
|
|
24,877
|
|
|
|
|
27,399
|
|
|
Non-GAAP Operating Expense
|
|
|
|
$
|
62,912
|
|
|
|
$
|
54,871
|
|
|
|
$
|
181,620
|
|
|
|
$
|
160,254
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Operating Expense Margin
|
|
|
|
|
42.6
|
%
|
|
|
|
45.4
|
%
|
|
|
|
43.4
|
%
|
|
|
|
46.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Operating Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Set forth below is a presentation of the company’s "Non-GAAP
Operating Income" and "Non-GAAP Operating Margin." Please reference
the "Explanation of Non-GAAP Financial Measures" section.
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Operating income (loss) (GAAP)
|
|
|
|
$
|
8,814
|
|
|
|
$
|
(13,406
|
)
|
|
|
$
|
19,334
|
|
|
|
$
|
(19,190
|
)
|
|
Acquisition-related and other deferred revenue
|
|
|
|
|
(161
|
)
|
|
|
|
(614
|
)
|
|
|
|
(762
|
)
|
|
|
|
(1,612
|
)
|
|
Asset impairment and loss on disposal of assets
|
|
|
|
|
914
|
|
|
|
|
20,966
|
|
|
|
|
999
|
|
|
|
|
23,769
|
|
|
Amortization of intangible assets
|
|
|
|
|
7,847
|
|
|
|
|
6,927
|
|
|
|
|
22,695
|
|
|
|
|
18,586
|
|
|
Acquisition-related income
|
|
|
|
|
(266
|
)
|
|
|
|
(3,310
|
)
|
|
|
|
(332
|
)
|
|
|
|
(1,653
|
)
|
|
Litigation-related expense
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
2
|
|
|
Headquarters relocation costs
|
|
|
|
|
1,353
|
|
|
|
|
—
|
|
|
|
|
3,552
|
|
|
|
|
—
|
|
|
Stock-based expense
|
|
|
|
|
8,255
|
|
|
|
|
8,669
|
|
|
|
|
27,383
|
|
|
|
|
30,666
|
|
|
Non-GAAP Operating Income
|
|
|
|
$
|
26,756
|
|
|
|
$
|
19,232
|
|
|
|
$
|
72,869
|
|
|
|
$
|
50,568
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Operating Margin
|
|
|
|
|
18.1
|
%
|
|
|
|
15.9
|
%
|
|
|
|
17.4
|
%
|
|
|
|
14.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Net Income
|
|
Set forth below is a presentation of the company’s "Non-GAAP Net
Income" and "Non-GAAP Net Income per Diluted Share." Please
reference the "Explanation of Non-GAAP Financial Measures" section.
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Net income (loss) (GAAP)
|
|
|
|
$
|
4,210
|
|
|
|
$
|
(8,192
|
)
|
|
|
$
|
9,289
|
|
|
|
$
|
(13,118
|
)
|
|
Income tax expense (benefit)
|
|
|
|
|
3,540
|
|
|
|
|
(5,605
|
)
|
|
|
|
7,199
|
|
|
|
|
(7,120
|
)
|
|
Income (loss) before income taxes
|
|
|
|
|
7,750
|
|
|
|
|
(13,797
|
)
|
|
|
|
16,488
|
|
|
|
|
(20,238
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related and other deferred revenue
|
|
|
|
|
(161
|
)
|
|
|
|
(614
|
)
|
|
|
|
(762
|
)
|
|
|
|
(1,612
|
)
|
|
Asset impairment and loss on disposal of assets
|
|
|
|
|
914
|
|
|
|
|
20,966
|
|
|
|
|
999
|
|
|
|
|
23,769
|
|
|
Amortization of intangible assets
|
|
|
|
|
7,847
|
|
|
|
|
6,927
|
|
|
|
|
22,695
|
|
|
|
|
18,586
|
|
|
Acquisition-related income
|
|
|
|
|
(266
|
)
|
|
|
|
(3,310
|
)
|
|
|
|
(332
|
)
|
|
|
|
(1,653
|
)
|
|
Litigation-related expense
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
2
|
|
|
Headquarters relocation costs
|
|
|
|
|
1,353
|
|
|
|
|
—
|
|
|
|
|
3,552
|
|
|
|
|
—
|
|
|
Stock-based expense
|
|
|
|
|
8,255
|
|
|
|
|
8,669
|
|
|
|
|
27,383
|
|
|
|
|
30,666
|
|
|
Non-GAAP income before income taxes
|
|
|
|
|
25,692
|
|
|
|
|
18,841
|
|
|
|
|
70,023
|
|
|
|
|
49,520
|
|
|
Assumed rate for income tax expense (2)
|
|
|
|
|
40.0
|
%
|
|
|
|
40.0
|
%
|
|
|
|
40.0
|
%
|
|
|
|
40.0
|
%
|
|
Assumed provision for income tax expense
|
|
|
|
|
10,277
|
|
|
|
|
7,536
|
|
|
|
|
28,010
|
|
|
|
|
19,808
|
|
|
Non-GAAP Net Income
|
|
|
|
$
|
15,415
|
|
|
|
$
|
11,305
|
|
|
|
$
|
42,013
|
|
|
|
$
|
29,712
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share - diluted
|
|
|
|
$
|
0.05
|
|
|
|
$
|
(0.11
|
)
|
|
|
$
|
0.12
|
|
|
|
$
|
(0.17
|
)
|
|
Non-GAAP Net Income per Diluted Share
|
|
|
|
$
|
0.20
|
|
|
|
$
|
0.15
|
|
|
|
$
|
0.54
|
|
|
|
$
|
0.38
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average outstanding shares - basic (4)
|
|
|
|
|
76,823
|
|
|
|
|
76,564
|
|
|
|
|
76,615
|
|
|
|
|
76,772
|
|
|
Weighted average outstanding shares - diluted (4)
|
|
|
|
|
78,124
|
|
|
|
|
77,063
|
|
|
|
|
77,525
|
|
|
|
|
77,375
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP On Demand Revenue, Ending On Demand Units, RPU and
ACV
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Set forth below is a presentation of the company’s "Non-GAAP On
Demand Revenue," "Ending On Demand Units," "RPU," and "ACV." Please
reference the "Explanation of Non-GAAP Financial Measures" section.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
On demand revenue (GAAP)
|
|
|
|
$
|
140,883
|
|
|
|
$
|
116,772
|
|
|
|
$
|
400,904
|
|
|
|
$
|
333,872
|
|
|
Acquisition-related and other deferred revenue
|
|
|
|
|
(161
|
)
|
|
|
|
(614
|
)
|
|
|
|
(762
|
)
|
|
|
|
(1,612
|
)
|
|
Non-GAAP On Demand Revenue
|
|
|
|
|
140,722
|
|
|
|
|
116,158
|
|
|
|
|
400,142
|
|
|
|
|
332,260
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ending On Demand Units
|
|
|
|
|
11,251
|
|
|
|
|
10,406
|
|
|
|
|
11,251
|
|
|
|
|
10,406
|
|
|
Average on demand units
|
|
|
|
|
11,196
|
|
|
|
|
10,354
|
|
|
|
|
11,016
|
|
|
|
|
9,995
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RPU
|
|
|
|
$
|
50.28
|
|
|
|
$
|
44.87
|
|
|
|
$
|
48.43
|
|
|
|
$
|
44.32
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ACV
|
|
|
|
$
|
565,700
|
|
|
|
$
|
466,917
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Net Income Guidance
|
|
Set forth below is a presentation of the company’s "Non-GAAP Net
Income" and "Non-GAAP Net Income per Diluted Share" guidance for the
fourth quarter and the year ended December 31, 2016. Please
reference the "Explanation of Non-GAAP Financial Measures" section.
|
|
|
|
|
|
|
|
Guidance Range for the
Twelve Months Ended
|
|
|
|
|
|
December 31, 2016
|
|
|
|
|
|
Low (3)
|
|
|
High (3)
|
|
Non-GAAP net income:
|
|
|
|
|
|
|
|
|
Net income (GAAP)
|
|
|
|
$
|
13,600
|
|
|
|
$
|
14,800
|
|
|
Income tax expense
|
|
|
|
|
10,580
|
|
|
|
|
11,480
|
|
|
Income before income taxes
|
|
|
|
|
24,180
|
|
|
|
|
26,280
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related and other deferred revenue
|
|
|
|
|
(950
|
)
|
|
|
|
(950
|
)
|
|
Asset impairment and loss on disposal of assets
|
|
|
|
|
1,000
|
|
|
|
|
1,000
|
|
|
Amortization of intangible assets
|
|
|
|
|
30,600
|
|
|
|
|
30,500
|
|
|
Acquisition-related income
|
|
|
|
|
(330
|
)
|
|
|
|
(330
|
)
|
|
Headquarters relocation costs
|
|
|
|
|
3,700
|
|
|
|
|
3,600
|
|
|
Stock-based expense
|
|
|
|
|
37,200
|
|
|
|
|
37,100
|
|
|
Non-GAAP income before income taxes
|
|
|
|
|
95,400
|
|
|
|
|
97,200
|
|
|
Assumed rate for income tax expense (2)
|
|
|
|
|
40.0
|
%
|
|
|
|
40.0
|
%
|
|
Assumed provision for income tax expense
|
|
|
|
|
38,160
|
|
|
|
|
38,880
|
|
|
Non-GAAP net income
|
|
|
|
$
|
57,240
|
|
|
|
$
|
58,320
|
|
|
|
|
|
|
|
|
|
|
|
Net Income per Diluted Share
|
|
|
|
$
|
0.17
|
|
|
|
$
|
0.19
|
|
|
Non-GAAP Net Income per Diluted Share
|
|
|
|
$
|
0.73
|
|
|
|
$
|
0.75
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average outstanding shares - diluted (4)
|
|
|
|
|
77,900
|
|
|
|
|
77,900
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA Guidance
|
|
|
|
|
|
|
|
|
Set forth below is a presentation of the company’s "Adjusted EBITDA"
guidance for the fourth quarter and the year ended December 31,
2016. Please reference the "Explanation of Non-GAAP Financial
Measures" section.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Guidance Range for the
Twelve Months Ended
|
|
|
|
|
|
December 31, 2016
|
|
|
|
|
|
Low (3)
|
|
|
High (3)
|
|
Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
Net income (GAAP)
|
|
|
|
$
|
13,600
|
|
|
|
$
|
14,800
|
|
|
Acquisition-related and other deferred revenue
|
|
|
|
|
(950
|
)
|
|
|
|
(950
|
)
|
|
Depreciation, asset impairment, and loss on disposal of assets
|
|
|
|
|
26,000
|
|
|
|
|
25,800
|
|
|
Amortization of intangible assets
|
|
|
|
|
30,600
|
|
|
|
|
30,500
|
|
|
Acquisition-related income
|
|
|
|
|
(330
|
)
|
|
|
|
(330
|
)
|
|
Interest expense, net
|
|
|
|
|
4,100
|
|
|
|
|
4,000
|
|
|
Income tax expense
|
|
|
|
|
10,580
|
|
|
|
|
11,480
|
|
|
Headquarters relocation costs
|
|
|
|
|
3,700
|
|
|
|
|
3,600
|
|
|
Stock-based expense
|
|
|
|
|
37,200
|
|
|
|
|
37,100
|
|
|
Adjusted EBITDA
|
|
|
|
$
|
124,500
|
|
|
|
$
|
126,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Certain amounts in prior periods of 2015 have been
reclassified to conform with current period presentation.
|
|
|
|
(2) A 40.0% tax rate is assumed in order to approximate
the Company's long-term effective corporate tax rate.
|
|
|
|
(3) Forward-looking statements involve known and
unknown risks, uncertainties and other factors that may cause
actual results, performance or achievements to be materially
different from any future results, performance or achievements
expressed or implied by the forward-looking statements. The
company may be required to revise its results upon finalizing its
review of quarterly and full year results, which could cause or
contribute to such differences. All information provided in this
release is as of the date hereof and RealPage, Inc. undertakes no
duty to update this information except as required by law. See
additional discussion under "Cautionary Statement Regarding
Forward-Looking Statements" above.
|
|
|
|
(4) For periods with GAAP net losses and non-GAAP net
income, the weighted-average outstanding shares used to calculate
non-GAAP net income per share includes potentially dilutive
securities that were excluded from the calculation of GAAP net
income per share as the effect was anti-dilutive.
|
|
|
CONTACT:
RealPage, Inc.
Investor Relations
Rhett Butler,
972-820-3773
rhett.butler@realpage.com
