FORM 8-K |
Delaware | 001-37461 | 26-4247032 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
8150 Leesburg Pike Vienna, Virginia | 22,182 | |
(Address of principal executive offices) | (Zip Code) |
¨ | 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)) |
(d) | Exhibits |
Exhibit No. | Description | |
99.1 | Press Release dated November 10, 2015. |
Alarm.com Holdings, Inc. | ||
Dated: November 10, 2015 | ||
By: | /s/ Jennifer Moyer | |
Jennifer Moyer | ||
Chief Financial Officer |
Exhibit No. | Description | |
99.1 | Press Release dated November 10, 2015. |
• | SaaS and license revenue increased 27% to $36.2 million for the third quarter of 2015 compared to $28.5 million for the third quarter of 2014. |
• | Total revenue increased 26% to $54.0 million for the third quarter of 2015 compared to $42.8 million for the third quarter of 2014. |
• | Net income was $3.2 million for the third quarter of 2015 compared to $2.7 million for the third quarter of 2014. |
• | Adjusted EBITDA1 was $9.7 million for the third quarter of 2015 compared to $5.1 million for the third quarter of 2014. |
• | Net income attributable to common stockholders was $3.2 million for the third quarter of 2015, or $0.07 per diluted share, compared to $0.1 million, or $0.03 per diluted share for the third quarter of 2014. |
• | Non-GAAP adjusted net income1 was $6.6 million for the third quarter of 2015 compared to $3.7 million for the third quarter of 2014. |
• | Non-GAAP adjusted net income attributable to common stockholders1 was $6.5 million for the third quarter of 2015, or $0.14 per diluted share, compared to $1.2 million, or $0.27 per diluted share for the third quarter of 2014. |
• | As of September 30, 2015, Alarm.com's SaaS and license revenue renewal rate was approximately 93%. |
• | Total cash and cash equivalents were $126.6 million as of September 30, 2015 compared to $42.6 million as of December 31, 2014. |
• | For the nine months ended September 30, 2015, cash flows from operations increased to $21.2 million from $6.5 million for the nine months ended September 30, 2014. |
• | Launched Voice Over LTE: Alarm.com and Verizon announced the availability of a significant enhancement to security communications enabled by America’s largest and most reliable 4G LTE network. With the availability of Voice over LTE (VoLTE), Alarm.com is now the first to provide direct communications from central stations into the home or business during an emergency over Verizon’s 4G LTE Network. With hands-free two-way voice communications, property owners can quickly provide critical information to security professionals and know that emergency services are on the way when they need them most. |
• | Introduced Smart Solution to Protect Properties from Water Damage: Water damage is a significant |
• | Announced Strategic Partnership with Securitas: Securitas is the second largest security company in the world with over 320 thousand employees and operations in 53 countries. Approximately half of Securitas total sales are from residential and commercial security operations across Europe, and we expect to begin deploying in parts of Europe by the middle of 2016. |
• | Announced Partnership with Pronet: Pronet is the leading electronic security company in Turkey with more than 200 thousand subscribers. Pronet’s smart home offering includes our security, video, energy management and home automation services, and is now available in all major cities throughout Turkey. |
• | SaaS and license revenue is expected to be approximately $37.7 million to $37.9 million. |
• | SaaS and license revenue is now expected to be approximately $139.9 million to $140.1 million, compared to the previous guidance range of $138.9 million to $139.3 million. |
• | Total revenue is now expected to be approximately $197.7 million to $200.1 million, which includes anticipated hardware and other revenue for the year in the range of $57.8 million to $60.0 million. This compares to the previous guidance range of $193.9 million to $195.3 million, which included the previous hardware and other revenue guidance range of $55.0 million to $56.0 million. |
• | Adjusted EBITDA is now expected to be approximately $27.7 million to $29.1 million, compared to the previous guidance range of $20.3 million to $21.3 million. |
• | Non-GAAP adjusted net income is now expected to be approximately $14.9 million to $15.6 million, compared to the previous guidance range of $9.8 million to $10.3 million. |
• | Non-GAAP adjusted net income attributable to common stockholders is now expected to be approximately $5.2 million to $5.4 million compared to the previous guidance range of $3.4 million to $3.6 million. Based on 26.5 million non-GAAP weighted average shares outstanding (diluted), non-GAAP adjusted net income attributable to common stockholders is now expected to be approximately $0.20 to $0.21 per diluted share compared to the previous guidance range of $0.13 to $0.14 per diluted share. |
Alarm.com Holdings, Inc. | ||||||||
Consolidated Balance Sheets | ||||||||
(in thousands, except share and per share data) | ||||||||
September 30, | December 31, | |||||||
Assets | 2015 | 2014 | ||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 126,601 | $ | 42,572 | ||||
Accounts receivable, net | 21,746 | 17,259 | ||||||
Inventory | 9,625 | 6,852 | ||||||
Deferred tax assets | 3,809 | 3,242 | ||||||
Other current assets | 4,535 | 1,919 | ||||||
Total current assets | 166,316 | 71,844 | ||||||
Property and equipment, net | 12,040 | 8,130 | ||||||
Intangible assets, net | 6,879 | 5,092 | ||||||
Goodwill | 24,723 | 21,374 | ||||||
Deferred tax assets | 6,715 | 5,121 | ||||||
Other assets | 6,452 | 9,371 | ||||||
Total Assets | $ | 223,125 | $ | 120,932 | ||||
Liabilities, redeemable convertible preferred stock and stockholders’ equity / (deficit) | ||||||||
Current liabilities: | ||||||||
Accounts payable, accrued expenses and other current liabilities | $ | 24,226 | $ | 15,233 | ||||
Accrued compensation | 6,905 | 5,816 | ||||||
Deferred revenue | 2,372 | 1,699 | ||||||
Total current liabilities | 33,503 | 22,748 | ||||||
Deferred revenue | 9,631 | 9,202 | ||||||
Long-term debt | 6,700 | 6,700 | ||||||
Other liabilities | 7,487 | 1,670 | ||||||
Total Liabilities | 57,321 | 40,320 | ||||||
Redeemable convertible preferred stock | ||||||||
Series B redeemable convertible preferred stock, $0.001 par value, 0 and 1,809,685 shares authorized; 0 and 1,809,685 shares issued and outstanding as of September 30, 2015 and December 31, 2014, liquidation preference of $0 and $191,132 as of September 30, 2015 and December 31, 2014. | — | 136,523 | ||||||
Series B-1 redeemable convertible preferred stock, $0.001 par value, 0 and 1,669,680 shares authorized; 0 and 82,934 shares issued and outstanding as of September 30, 2015 and December 31, 2014, liquidation preference of $0 and $8,759 as of September 30, 2015 and December 31, 2014. | — | 6,265 | ||||||
Series A redeemable convertible preferred stock, $0.001 par value, 0 and 3,511,725 shares authorized; 0 and 1,998,257 shares issued and outstanding as of September 30, 2015 and December 31, 2014, liquidation preference of $0 and $24,309 as of September 30, 2015 and December 31, 2014. | — | 59,668 | ||||||
Stockholders’ equity / (deficit) | ||||||||
Preferred stock, $0.001 par value, 10,000,000 and 0 shares authorized; 0 shares issued and outstanding as of September 30, 2015 and December 31, 2014. | — | — | ||||||
Common stock, $0.01 par value, 300,000,000 and 100,000,000 shares authorized; 45,568,625 and 2,823,816 shares issued; and 45,443,547 and 2,614,444 shares outstanding as of September 30, 2015 and December 31, 2014. | 454 | 26 | ||||||
Additional paid-in capital | 296,444 | 7,168 | ||||||
Treasury stock (35,523 shares at cost of $1.20 per share) | (42 | ) | (42 | ) | ||||
Accumulated other comprehensive income | — | — | ||||||
Accumulated deficit | (131,052 | ) | (128,996 | ) | ||||
Total Stockholders’ Equity / (Deficit) | 165,804 | (121,844 | ) | |||||
Total Liabilities, Redeemable Convertible Preferred Stock and Stockholders’ Equity / (Deficit) | $ | 223,125 | $ | 120,932 |
Alarm.com Holdings, Inc. | ||||||||||||||||
Consolidated Statement of Operations | ||||||||||||||||
(in thousands, except share and per share data) | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
Revenue: | ||||||||||||||||
SaaS and license revenue | $ | 36,158 | $ | 28,473 | $ | 102,247 | $ | 80,652 | ||||||||
Hardware and other revenue | 17,849 | 14,359 | 49,720 | 41,109 | ||||||||||||
Total revenue | 54,007 | 42,832 | 151,967 | 121,761 | ||||||||||||
Cost of revenue: | ||||||||||||||||
Cost of SaaS and license revenue | 6,764 | 6,002 | 19,094 | 16,679 | ||||||||||||
Cost of hardware and other revenue | 13,205 | 11,546 | 38,171 | 32,893 | ||||||||||||
Total cost of revenue | 19,969 | 17,548 | 57,265 | 49,572 | ||||||||||||
Operating expenses: | ||||||||||||||||
Sales and marketing | 8,425 | 8,107 | 24,405 | 19,873 | ||||||||||||
General and administrative | 9,932 | 6,746 | 25,516 | 19,175 | ||||||||||||
Research and development | 9,836 | 6,094 | 26,667 | 16,468 | ||||||||||||
Amortization and depreciation | 1,504 | 1,058 | 4,370 | 2,714 | ||||||||||||
Total operating expenses | 29,697 | 22,005 | 80,958 | 58,230 | ||||||||||||
Operating income | 4,341 | 3,279 | 13,744 | 13,959 | ||||||||||||
Interest expense | (44 | ) | (40 | ) | (128 | ) | (153 | ) | ||||||||
Other (expense) / income, net | (7 | ) | (80 | ) | (62 | ) | (70 | ) | ||||||||
Income before income taxes | 4,290 | 3,159 | 13,554 | 13,736 | ||||||||||||
Provision for income taxes | 1,061 | 492 | 4,775 | 4,720 | ||||||||||||
Net income | 3,229 | 2,667 | 8,779 | 9,016 | ||||||||||||
Dividends paid to participating securities | — | — | (18,987 | ) | — | |||||||||||
Income allocated to participating securities | (50 | ) | (2,549 | ) | — | (8,651 | ) | |||||||||
Net income / (loss) attributable to common stockholders | $ | 3,179 | $ | 118 | $ | (10,208 | ) | $ | 365 | |||||||
Per share information attributable to common stockholders: | ||||||||||||||||
Net income / (loss) per share: | ||||||||||||||||
Basic | $ | 0.07 | $ | 0.05 | $ | (0.60 | ) | $ | 0.17 | |||||||
Diluted | $ | 0.07 | $ | 0.03 | $ | (0.60 | ) | $ | 0.10 | |||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic | 44,922,410 | 2,429,445 | 16,910,090 | 2,211,263 | ||||||||||||
Diluted | 46,832,014 | 4,345,685 | 16,910,090 | 3,792,228 | ||||||||||||
Cash dividends declared per share | $ | — | $ | — | $ | 0.36 | $ | — | ||||||||
Stock-based compensation expense included in operating expenses: | ||||||||||||||||
Sales and marketing | $ | 114 | $ | 80 | $ | 260 | $ | 235 | ||||||||
General and administrative | 305 | 434 | 1,825 | 1,396 | ||||||||||||
Research and development | 390 | 232 | 890 | 734 | ||||||||||||
Total stock-based compensation expense | $ | 809 | $ | 746 | $ | 2,975 | $ | 2,365 |
Alarm.com Holdings, Inc. | ||||||||
Consolidated Statements of Cash Flows | ||||||||
(in thousands) | ||||||||
Nine Months Ended September 30, | ||||||||
2015 | 2014 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 8,779 | $ | 9,016 | ||||
Adjustments to reconcile net income to net cash from operating activities: | ||||||||
Provision for doubtful accounts | 420 | 909 | ||||||
Reserve for product returns | 1,148 | 1,453 | ||||||
Amortization on patents | 258 | 151 | ||||||
Amortization and depreciation | 4,370 | 2,714 | ||||||
Amortization of debt issuance costs | 81 | 43 | ||||||
Deferred income taxes | (2,160 | ) | (1,055 | ) | ||||
Change in fair value of contingent liability | 180 | — | ||||||
Unrealized gain on derivative instrument | — | (155 | ) | |||||
Undistributed losses from equity investees | 285 | 450 | ||||||
Stock-based compensation | 2,198 | 2,365 | ||||||
Other, net | (49 | ) | (196 | ) | ||||
Changes in operating assets and liabilities (net of business acquisition): | ||||||||
Accounts receivable | (6,043 | ) | (4,436 | ) | ||||
Inventory | (2,724 | ) | (4,799 | ) | ||||
Other assets | (1,904 | ) | (1,971 | ) | ||||
Accounts payable, accrued expenses and other current liabilities | 10,458 | 845 | ||||||
Deferred revenue | 1,095 | 894 | ||||||
Other liabilities | 4,784 | 260 | ||||||
Cash flows from operating activities | 21,176 | 6,488 | ||||||
Cash flows used in investing activities: | ||||||||
Business acquisition, net of cash acquired | (5,849 | ) | — | |||||
Additions to property and equipment | (6,520 | ) | (6,150 | ) | ||||
Investment in cost method investee | (54 | ) | — | |||||
Sale of cost method investee | — | 5 | ||||||
Issuances of notes receivable | (317 | ) | (687 | ) | ||||
Purchases of licenses to patents | (1,000 | ) | — | |||||
Cash flows used in investing activities | (13,740 | ) | (6,832 | ) | ||||
Cash flows from / (used in) financing activities | ||||||||
Proceeds from issuance of common stock from initial public offering, net of underwriting discount and commission | 97,976 | — | ||||||
Proceeds from issuance of debt, net of debt issuance costs | — | 6,376 | ||||||
Repayments of term loan | — | (7,500 | ) | |||||
Dividends paid to common stockholders | (1,013 | ) | — | |||||
Dividends paid to employees for unvested shares | (57 | ) | — | |||||
Dividends paid to redeemable convertible preferred stockholders | (18,930 | ) | — | |||||
Payments of offering costs | (2,632 | ) | (2,100 | ) | ||||
Repurchases of common stock | (1 | ) | (3 | ) | ||||
Proceeds from early exercise of stock-based awards | 124 | 1,533 | ||||||
Issuances of common stock from equity based plans | 300 | 530 | ||||||
Tax windfall benefit from stock-based awards | 826 | 1,009 | ||||||
Cash flows from / (used in) financing activities | 76,593 | (155 | ) | |||||
Net increase / (decrease) in cash and cash equivalents | 84,029 | (499 | ) | |||||
Cash and cash equivalents at beginning of the period | 42,572 | 33,583 | ||||||
Cash and cash equivalents at end of the period | $ | 126,601 | $ | 33,084 |
Alarm.com Holdings, Inc. | ||||||||||||||||
Reconciliation of Non-GAAP Measures | ||||||||||||||||
(in thousands) | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
Adjusted EBITDA: | ||||||||||||||||
Net income | $ | 3,229 | $ | 2,667 | $ | 8,779 | $ | 9,016 | ||||||||
Adjustments: | ||||||||||||||||
Other expense / income | 51 | 120 | 190 | 223 | ||||||||||||
Income tax expense | 1,061 | 492 | 4,775 | 4,720 | ||||||||||||
Amortization and depreciation expense | 1,504 | 1,058 | 4,370 | 2,714 | ||||||||||||
Stock-based compensation expense | 809 | 746 | 2,975 | 2,365 | ||||||||||||
Litigation expense | 3,000 | — | 3,513 | 63 | ||||||||||||
Total adjustments | 6,425 | 2,416 | 15,823 | 10,085 | ||||||||||||
Adjusted EBITDA | $ | 9,654 | $ | 5,083 | $ | 24,602 | $ | 19,101 | ||||||||
Adjusted net income: | ||||||||||||||||
Net income, as reported | $ | 3,229 | $ | 2,667 | $ | 8,779 | $ | 9,016 | ||||||||
Adjustments:2 | ||||||||||||||||
Other expense / income | 38 | 101 | 123 | 146 | ||||||||||||
Amortization expense | 423 | 325 | 1,030 | 766 | ||||||||||||
Stock-based compensation expense | 609 | 630 | 1,928 | 1,551 | ||||||||||||
Litigation expense | 2,259 | — | 2,276 | 41 | ||||||||||||
Non-GAAP adjusted net income | $ | 6,558 | $ | 3,723 | $ | 14,136 | $ | 11,520 |
Alarm.com Holdings, Inc. | ||||||||||||||||
Reconciliation of Non-GAAP Measures - continued | ||||||||||||||||
(in thousands) | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
Adjusted net income attributable to common stockholders: | ||||||||||||||||
Net income / (loss) attributable to common stockholders, as reported | $ | 3,179 | $ | 118 | $ | (10,208 | ) | $ | 365 | |||||||
Adjustments:2 | ||||||||||||||||
Dividends paid to participating securities | — | — | 18,987 | — | ||||||||||||
Other expense / income | 38 | 101 | 123 | 146 | ||||||||||||
Amortization expense | 423 | 325 | 1,030 | 766 | ||||||||||||
Stock-based compensation expense | 609 | 630 | 1,928 | 1,551 | ||||||||||||
Litigation expense | 2,259 | — | 2,276 | 41 | ||||||||||||
Less: income allocated to participating securities | — | — | (9,259 | ) | — | |||||||||||
Non-GAAP adjusted net income attributable to common stockholders | $ | 6,508 | $ | 1,174 | $ | 4,877 | $ | 2,869 | ||||||||
Adjusted net income per share: | ||||||||||||||||
Net income / (loss) per share - basic, as reported | $ | 0.07 | $ | 0.05 | $ | (0.60 | ) | $ | 0.17 | |||||||
Adjustments:2 | ||||||||||||||||
Dividends paid to participating securities | — | — | 1.12 | — | ||||||||||||
Other expense / income | — | 0.04 | 0.01 | 0.07 | ||||||||||||
Amortization expense | 0.01 | 0.13 | 0.06 | 0.35 | ||||||||||||
Stock-based compensation expense | 0.01 | 0.26 | 0.11 | 0.70 | ||||||||||||
Litigation expense | 0.05 | — | 0.13 | 0.02 | ||||||||||||
Less: income allocated to participating securities | — | — | (0.55 | ) | — | |||||||||||
Non-GAAP adjusted net income per share - basic | $ | 0.14 | $ | 0.48 | $ | 0.28 | $ | 1.31 | ||||||||
Non-GAAP adjusted net income per share - diluted | $ | 0.14 | $ | 0.27 | $ | 0.26 | $ | 0.76 | ||||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic, as reported | 44,922,410 | 2,429,445 | 16,910,090 | 2,211,263 | ||||||||||||
Diluted, as reported | 46,832,014 | 4,345,685 | 16,910,090 | 3,792,228 | ||||||||||||
Dilutive shares | — | — | 1,715,402 | — | ||||||||||||
Non-GAAP weighted average common shares outstanding - diluted | 46,832,014 | 4,345,685 | 18,625,492 | 3,792,228 |