[PART I – FINANCIAL INFORMATION](index=6&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [Financial Statements](index=7&type=section&id=Item%201.%20Financial%20Statements) The unaudited condensed consolidated financial statements show key financial positions and performance for the periods ended September 30, 2023 [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $1.53 billion as of September 30, 2023, primarily due to a goodwill impairment charge Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | Sep 30, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $272,312 | $236,586 | | Goodwill | $673,159 | $717,743 | | Total Assets | $1,526,821 | $1,572,922 | | **Liabilities & Equity** | | | | Total Liabilities | $475,070 | $493,261 | | Total Stockholders' Equity | $1,051,751 | $1,079,661 | | Total Liabilities & Equity | $1,526,821 | $1,572,922 | [Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20%28Loss%29) The company reported a Q3 2023 net loss of $49.0 million, driven by a significant goodwill impairment charge Statement of Operations Highlights (in thousands, except per share data) | Metric | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | | :--- | :--- | :--- | :--- | :--- | | Revenues | $85,576 | $84,700 | $266,327 | $249,011 | | Income (loss) from operations | $(52,784) | $10,859 | $(32,307) | $21,141 | | Net income (loss) | $(48,965) | $3,936 | $(42,901) | $5,557 | | Diluted EPS | $(0.31) | $0.02 | $(0.27) | $0.03 | - A **goodwill impairment expense of $46,984 thousand** was recorded in Q3 2023, which was the primary driver of the net loss for the period[49](index=49&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) Stockholders' equity declined to $1.05 billion, mainly due to the period's net loss and partially offset by equity-based compensation - The balance of total stockholders' equity was **$1,051,751 thousand** as of September 30, 2023, down from $1,079,661 thousand at December 31, 2022[40](index=40&type=chunk)[91](index=91&type=chunk) - Key changes during the nine months ended September 30, 2023 include a **net loss of $42.9 million** and **equity-based compensation expense of $20.8 million**[91](index=91&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=12&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations was $59.4 million for the nine months ended September 30, 2023, contributing to a higher cash balance Cash Flow Summary (in thousands) | Activity | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $59,429 | $57,058 | | Net cash used in investing activities | $(18,503) | $(15,238) | | Net cash used in financing activities | $(8,195) | $(6,395) | | **Net increase in cash** | **$32,624** | **$27,159** | | **Cash at end of period** | **$272,312** | **$213,783** | [Notes to Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail accounting policies and highlight a $47.0 million goodwill impairment and recent acquisitions - The company is a global leader in biosimulation, providing software and technology-driven services to accelerate drug discovery and development[11](index=11&type=chunk) - During Q3 2023, the company recorded a **goodwill impairment charge of $46,984 thousand** for its Regulatory and Writing business reporting unit[6](index=6&type=chunk)[272](index=272&type=chunk) - On June 20, 2023, the company acquired the Drug Interaction Database (DIDB) from the University of Washington for a total estimated consideration of **$8.34 million**[109](index=109&type=chunk) - On October 10, 2023, subsequent to the quarter end, the company acquired Formedix Limited for a total consideration of up to **$39.0 million**[183](index=183&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=37&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, highlighting revenue growth offset by a goodwill impairment impacting net income Key Performance Indicators | | Q3 2023 | Q3 2022 | | :--- | :--- | :--- | | Bookings (in millions) | $84.8 | $79.8 | | Renewal Rate | 86% | 93% | Non-GAAP Reconciliation: Adjusted EBITDA (in thousands) | | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | $(48,965) | $3,936 | $(42,901) | $5,557 | | **Adjusted EBITDA** | **$28,844** | **$32,703** | **$93,523** | **$88,312** | Non-GAAP Reconciliation: Adjusted Net Income (in thousands) | | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | $(48,965) | $3,936 | $(42,901) | $5,557 | | **Adjusted Net Income** | **$17,074** | **$16,648** | **$54,748** | **$48,194** | [Results of Operations](index=48&type=section&id=Results%20of%20Operations) Q3 revenue grew 1% while nine-month revenue grew 7%, with net loss driven by a goodwill impairment charge Revenue by Segment - Three Months Ended Sep 30 (in thousands) | Segment | 2023 | 2022 | Change $ | Change % | | :--- | :--- | :--- | :--- | :--- | | Software | $31,331 | $28,392 | $2,939 | 10% | | Services | $54,245 | $56,308 | $(2,063) | (4)% | | **Total** | **$85,576** | **$84,700** | **$876** | **1%** | Revenue by Segment - Nine Months Ended Sep 30 (in thousands) | Segment | 2023 | 2022 | Change $ | Change % | | :--- | :--- | :--- | :--- | :--- | | Software | $98,058 | $86,309 | $11,749 | 14% | | Services | $168,269 | $162,702 | $5,567 | 3% | | **Total** | **$266,327** | **$249,011** | **$17,316** | **7%** | - The **Q3 2023 net loss of $49.0 million** was primarily driven by a **$47.0 million goodwill impairment expense** and an $8.8 million increase in expense related to contingent considerations[344](index=344&type=chunk) - For the nine months ended Sep 30, 2023, General and Administrative expenses **increased by $8.3 million, or 16%**, mainly due to an $11.3 million increase related to contingent consideration[356](index=356&type=chunk) [Liquidity and Capital Resources](index=56&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a strong liquidity position with $272.3 million in cash and sufficient credit availability Liquidity Summary (in thousands) | Item | Sep 30, 2023 | | :--- | :--- | | Cash and cash equivalents | $272,312 | | Term loan outstanding | $295,205 | | Revolving line of credit availability | $100,000 | - **Net cash provided by operating activities increased to $59.4 million** for the nine months ended Sep 30, 2023, from $57.1 million in the prior-year period[381](index=381&type=chunk) - The company was in **compliance with all covenants** of its Credit Agreement as of September 30, 2023[387](index=387&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=59&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) There have been no material changes to the company's market risk exposure during the nine months ended September 30, 2023 - There were **no material changes** to the Company's market risk exposure during the nine months ended September 30, 2023[401](index=401&type=chunk) [Controls and Procedures](index=59&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of September 30, 2023 - The CEO and CFO concluded that the company's disclosure controls and procedures were **effective** as of September 30, 2023[402](index=402&type=chunk)[404](index=404&type=chunk) - **No changes in internal control over financial reporting** occurred during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal controls[405](index=405&type=chunk) [PART II – OTHER INFORMATION](index=61&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Legal Proceedings](index=61&type=section&id=Item%201.%20Legal%20Proceedings) No material changes to legal proceedings have occurred since the 2022 Annual Report - There have been **no material changes** to the company's legal proceedings as disclosed in the 2022 Annual Report[408](index=408&type=chunk) [Risk Factors](index=61&type=section&id=Item%201A.%20Risk%20Factors) A new risk factor was added concerning potential adverse developments in the financial services industry - A **new risk factor** was added regarding adverse developments in the financial services industry, which could impair the ability to access cash and equivalents[409](index=409&type=chunk)[410](index=410&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=61&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 36,944 shares in Q3 2023 to satisfy employee tax withholding obligations Equity Security Repurchases - Q3 2023 | Period | Total Shares Purchased | Weighted Avg. Price Paid | | :--- | :--- | :--- | | Jul 2023 | 568 | $18.21 | | Aug 2023 | 5,108 | $19.40 | | Sep 2023 | 31,268 | $14.43 | | **Total** | **36,944** | **$15.18** | - Share repurchases were made to cover employee tax obligations from the vesting of stock-based compensation awards[413](index=413&type=chunk) [Other Information](index=62&type=section&id=Item%205.%20Other%20Information) Disclosures include a new Rule 10b5-1 trading plan for the General Counsel and an amended CFO employment agreement - On August 11, 2023, the company's General Counsel adopted a **Rule 10b5-1 trading plan** for the potential sale of up to 76,070 shares of common stock[415](index=415&type=chunk) - On November 7, 2023, the company amended the employment agreement with CFO John Gallagher to include a **payment of $235,750** related to an unpaid bonus from a prior employer[422](index=422&type=chunk)

Certara Inc. (NASDAQ:CERT) Q2 2023 Results Conference Call August 9, 2023 5:00 PM ET Company Participants David Deuchler - IR William Feehery - CEO and Director John Gallagher - Chief Financial Officer Conference Call Participants David Windley - Jefferies Vikram Purohit - Morgan Stanley Jeff Garro - Stephens Inc Kyle Crews - Credit Suisse Financial Services Max Smock - William Blair Gaurav Goparaju - Berenberg Capital Markets Joe Vruwink - Baird Operator Good day, and thank you for standing by. Welcome to ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _________________________ FORM 10-Q _________________________ (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 or o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______________ to ______________ Commission File Number: 001-39799 ______________________ ...

Certara, Inc. (NASDAQ:CERT) Q1 2023 Results Conference Call May 8, 2023 5:00 PM ET Company Participants David Deuchler - Investor Relations William Feehery - Chief Executive Officer John Gallagher - Chief Financial Officer Conference Call Participants David Windley - Jefferies Vikram Purohit - Morgan Stanley Jeff Garro - Stephens Inc. Luke Sergott - Barclays Max Smock - William Blair Wolf Chanoff - Bank of America Joy Zhang - SVB Securities Gaurav Goparaju - Berenberg Capital Markets Joe Vruwink - Baird Ope ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Table of Contents • any disruption in the operations of the third-party providers who host our software solutions or any limitations on their capacity or interference with our use; • our ability to r ...

We outsource substantially all of the infrastructure relating to our hosted software solutions to third-party hosting services. Customers of our hosted software solutions need to be able to access our software platform at any time, without interruption or degradation of performance, and we provide them with service-level commitments with respect to uptime. Our hosted software solutions depend on protecting the virtual cloud infrastructure hosted by third-party hosting services by maintaining its configurati ...

Certara Inc. (NASDAQ:CERT) Q3 2022 Results Conference Call November 7, 2022 5:00 PM ET Company Participants David Deuchler - IR William Feehery - CEO Andrew Schemick - CFO Conference Call Participants Dave Windley - Jefferies Max Smock - William Blair Luke Sergott - Barclays Joe Vruwink - Baird Wolf Chanoff - Bank of America Lu Li - Credit Suisse Operator Good day, and thank you for standing by. Welcome to the Certara Third Quarter 2022 Earnings Conference Call. At this time, all participants are in a liste ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-39799 Certara, Inc. (Exact name of registrant as specified in its charter) Delaware 82-2180925 (State or ...

Financial Data and Key Metrics Changes - The company reported second quarter revenue of $82.8 million, growing 18% year-over-year on a reported basis and 21% on a constant currency basis [9][23] - Adjusted EBITDA for the second quarter of 2022 was $28 million, compared to $25.5 million for the second quarter of 2021, representing 9% growth [37] - Net loss for the second quarter of 2022 was $0.6 million compared to a net loss of $2.9 million in the second quarter of 2021 [36] Business Line Data and Key Metrics Changes - Software revenue was $28.7 million, growing 48% year-over-year on a constant currency basis, with a 92% aggregate renewal rate [11][25] - Technology-driven services revenue was $54 million, representing a 10% growth on a constant currency basis compared to the second quarter of last year [16][28] - Regulatory services growth was flat, and the company is no longer forecasting it to grow at historical rates for the remainder of the year [29][19] Market Data and Key Metrics Changes - Trailing 12 months bookings came in at $393.5 million, up approximately 25% year-over-year on a reported basis [24] - The company experienced a slowdown in regulatory services due to delays in projects and recent regulatory decisions affecting Chinese customers [18][19] - The biosimulation services revenue continues to show robust growth in the high teens on a constant currency basis [16][29] Company Strategy and Development Direction - The company is committed to expanding the role of biosimulation to meet the needs of researchers, with new product launches such as the Simcyp Discovery Simulator [12][21] - There is a focus on investing in the team to expand existing customer relationships and establish new ones, particularly in biosimulation [17][21] - The company is adjusting its revenue guidance for the full year to $325 million to $335 million, reflecting a reduction due to foreign exchange and regulatory services performance [19][40] Management's Comments on Operating Environment and Future Outlook - Management noted that the regulatory services business has experienced more volatility than planned, and they are taking a more conservative outlook for the remainder of the year [18][19] - The company remains optimistic about the growth in biosimulation and Pinnacle 21, with opportunities to expand offerings throughout the drug development cycle [21][39] - Management expressed confidence in the company's ability to capitalize on opportunities despite challenges in the regulatory services segment [21][78] Other Important Information - The company ended the quarter with $194.8 million of cash and cash equivalents and had $299 million of outstanding borrowings under its term loan [38] - Adjusted diluted earnings per share for the second quarter of 2022 was $0.09, compared to $0.07 for the second quarter of 2021 [37] Q&A Session Summary Question: Visibility on Regulatory Services - Management indicated that visibility varies by client, with about 60% visibility on project start dates [46][47] Question: Update on Biologics Simulator and Pinnacle 21 - The biologics simulator is growing, and Pinnacle 21 is tracking well with early sales from new product launches [50][52] Question: Headwinds from Chinese Customers - The headwind is specific to the regulatory business, but there are opportunities for biosimulation to address concerns about diversity in submissions [54] Question: Length of Sales Cycle - The sales cycle typically runs a couple of quarters, with strong bookings on the biosimulation side despite challenges in regulatory [62][65] Question: Adjusted EBITDA Margin - The adjusted EBITDA margin was impacted by lower revenues and investments in corporate functions, with expectations for a more even margin through the back half of the year [71][73]

Table of Contents | --- | --- | --- | --- | |------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------- ...