ATLANTA, April 22, 2025 (GLOBE NEWSWIRE) -- First Advantage Corporation (NASDAQ:FA), a leading provider of global software and data in the HR technology industry, today released its 2025 Global Trends Report. Meticulously crafted from hundreds of customer survey responses, and analysis of hundreds of millions of anonymized data points, the latest edition of the proprietary research offers a global perspective and unparalleled insight into the evolving landscape of background screening.   As one of the large ...

ATLANTA, April 17, 2025 (GLOBE NEWSWIRE) -- First Advantage Corporation (NASDAQ:FA), a leading provider of global software and data in the HR technology industry, will issue its first quarter 2025 financial results on Thursday, May 8, 2025 prior to the Company's earnings conference call, which will be held at 8:30 a.m. ET on the same day. Conference Call Details To participate in the conference call, please dial 800-267-6316 (domestic) or 203-518-9783 (international) approximately ten minutes before the 8:3 ...

ATLANTA, April 02, 2025 (GLOBE NEWSWIRE) -- First Advantage Corporation (NASDAQ:FA), a leading provider of global software and data in the HR technology industry, today announced it will host its inaugural Investor Day in New York City and webcast live on Wednesday, May 28, 2025, with presentations beginning at 9:00 a.m. ET. The event is expected to conclude at approximately 12:00 p.m. ET. Scott Staples, Chief Executive Officer, will be joined by other members of the executive management team to present a d ...

Company Overview - First Advantage Corporation (NASDAQ:FA) is a leading global provider of employment background screening, identity, and verification solutions [3] - The company is headquartered in Atlanta, Georgia, and operates in over 200 countries and territories, serving approximately 80,000 customers [3] Upcoming Events - Company management will participate in a fireside chat at the Wolfe Research FinTech Forum in New York City on March 11, 2025, at 8:00 am ET [1] - Private meetings with investors will also be hosted throughout the day [1] Investor Relations - A live webcast of the event will be available on the First Advantage investor relations website, with subsequent replays posted for a limited time [2] - Investor contact information is provided for further inquiries [4]

Financial Data and Key Metrics Changes - For Q4 2024, pro forma revenues were $375 million, up 0.9% year-over-year, while full-year pro forma revenues reached approximately $1.5 billion, up about 2% year-over-year [36][42]. - Pro forma adjusted EBITDA for Q4 was $100 million, with a margin of 26.7%, down approximately 300 basis points from the prior year [40]. - Full-year adjusted net income was $124 million, with adjusted diluted EPS of $0.82 [46]. Business Line Data and Key Metrics Changes - Legacy First Advantage Americas segment revenues were $172 million, down 5.5% year-over-year, impacted by consumer uncertainty [37]. - Legacy First Advantage International segment revenues increased 8.9% to $24 million, with a 7% increase on a constant currency basis [38]. - Legacy Sterling segment pro forma revenues for Q4 were $181 million, up 7% year-over-year, with a 6% contribution from the Vault acquisition [39]. Market Data and Key Metrics Changes - 87% of 2024 pro forma revenues were generated in the U.S. [18]. - The company completed nearly 190 million screens for approximately 80,000 active customers across 200 countries and territories [20]. - Gross retention rate remained stable at approximately 96% [20]. Company Strategy and Development Direction - The company is rolling out its updated strategy, FA 5.0%, focusing on synergy targets, deleveraging the balance sheet, and accelerating the go-to-market strategy [12]. - The synergy target range has been increased to $60 million to $70 million, up from the previous $50 million to $70 million [13]. - The company aims to leverage its combined capabilities to enhance customer value propositions and drive innovation [18][32]. Management's Comments on Operating Environment and Future Outlook - Management maintains a cautiously optimistic outlook for 2025, despite an uncertain macro environment [15]. - The company expects to see normalization in hiring patterns, which will positively impact future growth [100]. - Management noted that government efficiency efforts could potentially serve as a tailwind for the business [16]. Other Important Information - The company plans to host its inaugural Investor Day on May 28, where it will share more about its strategy and integration program [68]. - The integration of Sterling is progressing well, with a strong cultural match between the teams [108]. Q&A Session Summary Question: Can you provide more detail about the weakness in seasonal hiring in retail and transportation? - Management noted a trend of normalization in hiring patterns, with hiring slowing down around mid-November and continuing through December, but picking back up in January [72]. Question: Regarding the big win in the healthcare space using the Sterling platform, will you be supporting the Sterling back end indefinitely? - Management confirmed that they will maintain both platforms but will reduce overheads and headcount through innovative solutions that allow clients to leverage the best of both platforms without disruption [80]. Question: Are you tracking a Net Promoter Score pre-merger and post-merger? - Management stated that they continue to measure Net Promoter Scores for both customers and candidates, and feedback has been positive regarding the acquisition [83]. Question: Do you feel that the low end of the guidance embeds leeway for a slower-than-expected recovery in base growth? - Management acknowledged that base growth is expected to remain negative for the year, but they feel confident in their guidance range due to strong pipeline conversion and historical performance [92]. Question: What are the key areas for synergy realization? - Management indicated that synergies are being realized across various functions, including operations and fulfillment, with a focus on reducing duplicative costs [105].

Debt and Financial Obligations - The company may incur significant additional indebtedness in the future, with existing credit agreements containing restrictions that are subject to qualifications and exceptions[158]. - The ability to generate cash is crucial for servicing debt, and any failure to meet debt obligations could adversely affect the company's business and financial condition[159]. - If the company does not generate sufficient cash flow or cannot refinance its indebtedness, it may need to sell assets or reduce capital investments, which could materially impact operations[160]. - The company's debt instruments impose significant operating and financial restrictions, limiting its ability to incur additional debt, pay dividends, or make acquisitions[161]. - As of December 31, 2024, the carrying value of the company's long-term debt was $2,121.3 million, with a potential interest expense fluctuation of approximately $21.7 million for a hypothetical 100 basis point change in interest rates[343]. - The company entered into an interest rate swap agreement with a notional amount of $100.0 million, transitioning from LIBOR to SOFR with a fixed rate of 4.32%[345]. - The company has entered into multiple interest rate swap agreements to manage borrowing costs, with notional amounts totaling $160.0 million and $275.0 million maturing on December 31, 2026[347]. Shareholder and Corporate Governance - Silver Lake beneficially owned 51.7% of the company's outstanding common stock as of December 31, 2024, allowing it to control corporate policies and decisions[163]. - The company does not intend to pay dividends for the foreseeable future, with a one-time special cash dividend of $1.50 per share paid in August 2023 not indicating future dividend intentions[170]. - The company qualifies as a "controlled company" under Nasdaq rules, which may exempt it from certain corporate governance requirements[172]. - As of December 31, 2024, approximately 826,828,855 shares of common stock are authorized but unissued, which could dilute existing shareholders if issued[173]. - Future sales of common stock by existing stockholders could negatively impact the market price of the company's shares[174]. - Anti-takeover provisions in the company's organizational documents may delay or prevent a change of control, potentially affecting shareholder interests[177]. - The company has a classified board of directors with staggered three-year terms, which may limit stockholder ability to obtain a premium for shares[180]. - The company is authorized to issue up to 250,000,000 shares of preferred stock without stockholder approval, which may affect the value of common stock[181]. Cash and Currency Management - As of December 31, 2024, the company had cash and cash equivalents of $168.7 million, down from $213.8 million in 2023[341]. - Currency translation losses were approximately $(16.2) million, $1.2 million, and $(20.7) million for the years ended December 31, 2024, 2023, and 2022, respectively[351]. - The company has exposure to foreign currency fluctuations primarily related to the British Pound Sterling and Indian Rupee[349]. - The company has not hedged its investments in foreign subsidiaries against foreign currency exchange rate fluctuations[351]. Inflation and Economic Impact - The company does not believe inflation has materially affected its business, but acknowledges potential risks if costs rise significantly[352].

Core Insights - First Advantage (FA) reported quarterly earnings of $0.18 per share, missing the Zacks Consensus Estimate of $0.24 per share, and down from $0.29 per share a year ago, representing an earnings surprise of -25% [1] - The company posted revenues of $307.12 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 4.12%, compared to year-ago revenues of $202.56 million [2] - The stock has underperformed the market, losing about 0.8% since the beginning of the year, while the S&P 500 gained 1.3% [3] Earnings Outlook - The current consensus EPS estimate for the coming quarter is $0.17 on revenues of $365.29 million, and for the current fiscal year, it is $1 on revenues of $1.6 billion [7] - The estimate revisions trend for First Advantage is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Technology Services industry, to which First Advantage belongs, is currently in the top 30% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Performance - Full Year 2024 revenues reached $860.2 million, an increase from $763.8 million in 2023, representing a growth of 12.0%[6] - The company reported a net loss of $(110.3) million for the full year 2024, with a net loss margin of (12.8)%, impacted by $130.5 million in acquisition-related expenses[4] - Adjusted EBITDA for the full year 2024 was $249.3 million, with an Adjusted EBITDA margin of 29.0%[6] - For Q4 2024, revenues were $307.1 million, up from $202.6 million in Q4 2023, marking a growth of 51.5%[6] - The company incurred a net loss of $(100.4) million in Q4 2024, with a net loss margin of (32.7)%[6] - Adjusted Net Income for the full year 2024 was $123.7 million, down from $145.8 million in 2023[6] Future Projections - The company expects full year 2025 revenues to be between $1.5 billion and $1.6 billion, with Adjusted EBITDA projected between $410 million and $450 million[3][10] - Adjusted Diluted Earnings Per Share for 2025 is guided to be between $0.86 and $1.03[10] Acquisition and Integration - First Advantage has updated its synergy target from $50 million to $70 million to a new range of $60 million to $70 million following the acquisition of Sterling[7] - The integration of Sterling is progressing well, with $20 million in run rate cost synergies already actioned[7] - The company incurred transaction and acquisition-related charges of approximately $93.2 million for the three months ended December 31, 2024, primarily due to the acquisition of Sterling[34] Assets and Liabilities - Total current assets increased to $475,993,000 as of December 31, 2024, up from $373,738,000 in 2023, reflecting a 27.4% growth[28] - Goodwill rose significantly to $2,124,528,000 in 2024 from $820,654,000 in 2023, indicating a substantial increase in acquisitions or business combinations[28] - First Advantage's total assets reached $3,922,893,000 as of December 31, 2024, compared to $1,630,654,000 in 2023, marking a 140.2% increase[28] - First Advantage's total liabilities increased to $2,615,854,000 in 2024 from $723,921,000 in 2023, indicating a 262.5% rise[28] Cash Flow and Expenses - The company reported cash flows from operating activities of $28,196,000 for the year ended December 31, 2024, a decrease from $162,820,000 in 2023[31] - Operating expenses for the three months ended December 31, 2024, totaled $387,798,000, a 123.9% increase from $173,181,000 in the same period of 2023[29] - Cash flows from operating activities for the three months ended December 31, 2024 were reported at $(85,666) thousand, compared to $56,740 thousand in the same period of 2023[39] Shareholder Information - The weighted average number of shares outstanding for basic calculations increased to 162,774,306 in Q4 2024 from 143,167,422 in Q4 2023[29] - The company reported a diluted net loss per share of $(0.62) for the three months ended December 31, 2024, compared to earnings of $0.10 per share in the same period of 2023[36] - The adjusted diluted earnings per share (Non-GAAP) for the three months ended December 31, 2024 was $0.18, down from $0.29 in the same period of 2023[36] Taxation - The effective tax rate for the three months ended December 31, 2024 was approximately 27.6%, compared to 21.2% for the same period in 2023[40] - The company had net operating loss carryforwards of approximately $15.3 million for federal income tax purposes as of December 31, 2024[40]

Core Insights - First Advantage Corporation has completed the acquisition of Sterling Check Corp, which is expected to enhance its operational scale and synergy benefits moving forward [4][6][24] - The company reported significant financial results for the fourth quarter and full year ended December 31, 2024, with revenues of $860.2 million, a net loss of $(110.3) million, and an adjusted EBITDA of $249.3 million [5][6][24] Full Year 2024 Highlights - Revenues for 2024 reached $860.2 million, up from $763.8 million in 2023, representing a year-over-year increase of approximately 12.3% [4][5] - The net loss for 2024 was $(110.3) million, compared to a net income of $37.3 million in 2023, reflecting a significant decline due to acquisition-related expenses [5][6] - Adjusted EBITDA for the year was $249.3 million, with an adjusted EBITDA margin of 29.0% [5][6] Fourth Quarter 2024 Highlights - In Q4 2024, revenues were $307.1 million, compared to $202.6 million in Q4 2023, marking a 51.5% increase [4][5] - The net loss for Q4 2024 was $(100.4) million, with a net loss margin of (32.7)%, influenced by $97.1 million in acquisition-related expenses [5][6] - Adjusted EBITDA for the quarter was $82.9 million, with an adjusted EBITDA margin of 27.0% [5][6] Full Year 2025 Guidance - The company has provided guidance for 2025, projecting revenues between $1.5 billion and $1.6 billion, adjusted EBITDA of $410 million to $450 million, adjusted net income of $152 million to $182 million, and adjusted diluted earnings per share of $0.86 to $1.03 [3][8] - The guidance reflects expected synergies from the Sterling acquisition and a cautious outlook on growth due to macroeconomic conditions [7][8] Synergy Targets - First Advantage has already realized $20 million in run-rate cost synergies from the Sterling acquisition and has updated its synergy target range to $60 million to $70 million [6][7] - The combined company generated approximately $1.51 billion in revenues and nearly $397 million in adjusted EBITDA in 2024, demonstrating effective integration and execution strategies [6][7]

Core Viewpoint - First Advantage Corporation will release its fourth quarter and full year 2024 financial results on February 27, 2025, prior to an earnings conference call scheduled for 8:30 a.m. ET on the same day [1]. Financial Results Announcement - The financial results will be issued before the earnings conference call on February 27, 2025 [1]. - The conference call will be accessible via a domestic dial-in number (800-445-7795) and an international number (785-424-1699) [2]. - A live webcast of the conference call will be available on the company's investor relations website [2]. Company Overview - First Advantage is a leading global provider of employment background screening, identity, and verification solutions [4]. - The company operates in over 200 countries and territories, utilizing proprietary technology to deliver innovative services [4]. - First Advantage aims to help customers mitigate risk and hire the best talent, including employees, contractors, and tenants [4].