Exela Technologies(XELA) - 2021 Q4 - Annual Report

Financial Performance - Exela Technologies reported revenue of $1,166.6 million for the fiscal year ended December 31, 2021, reflecting a significant focus on business and transaction processing services [364]. - Total revenue for 2021 was $1,166,606, a decrease of 9.7% from $1,292,562 in 2020 [384]. - Net loss for 2021 was $142,390, compared to a net loss of $178,530 in 2020, showing an improvement of 20.2% [384]. - Operating profit for 2021 was $21,389, a significant recovery from an operating loss of $16,420 in 2020 [384]. - Exela reported a net loss attributable to common stockholders of $143.97 million for the year ended December 31, 2021, compared to a net loss of $179.84 million in 2020 and $512.43 million in 2019 [475]. Debt and Liabilities - The company had $1,246.7 million of debt outstanding as of December 31, 2021, with a weighted average interest rate of 10.9% [352]. - Long-term debt decreased to $1,104,399 in 2021 from $1,498,004 in 2020, a reduction of 26.4% [382]. - The Company reduced indebtedness by $338.5 million during the year ended December 31, 2021, and materially reduced its current liabilities [401]. - The company has a $350 million senior secured term loan maturing on July 12, 2023, with an original issue discount of $7 million [511]. - The company reported accumulated impairment of $316.5 million related to ITPS as of December 31, 2021 [509]. Cash Flow and Assets - The company generated cash flows from operating activities amounting to $(111.53) million in 2021, a significant increase in cash used compared to $(29.78) million in 2020 [395]. - Total cash and cash equivalents at the end of 2021 were $48.06 million, down from $70.31 million at the end of 2020 [395]. - Total current assets decreased to $279,891 in 2021 from $323,293 in 2020, a decline of 13.4% [382]. - Cash and cash equivalents dropped to $20,775 in 2021 from $68,221 in 2020, a decrease of 69.5% [382]. Internal Controls and Audit - The company identified material weaknesses in internal control over financial reporting as of December 31, 2021, which could lead to material misstatements [371]. - Exela's management is responsible for maintaining effective internal control over financial reporting, which was assessed as ineffective due to identified material weaknesses [371]. - The audit report expressed an unqualified opinion on the consolidated financial statements for the three-year period ended December 31, 2021 [372]. Equity and Stock - The Company raised $406.8 million in gross proceeds from equity financings during the year ended December 31, 2021 [401]. - The Series A Preferred Stock had a beneficial conversion feature recognized as a discount of $16.4 million as of December 31, 2017, with no dividend equivalent recognized in subsequent years [470]. - The Company repurchased shares worth $607,000 during 2019, with a total of 79,321 shares repurchased [389]. Foreign Currency and Risks - The company is exposed to foreign currency risks from normal business operations, including transaction gains and losses associated with intercompany loans [354]. - The Company recognized a net exchange loss of $0.2 million for the year ended December 31, 2021, compared to a net exchange gain of $0.4 million in 2020 [468]. Operational Segments - Exela's operations are concentrated in the United States and EMEA, organized into three segments comprising significant strategic business units [364]. - The Company operates in three major industry verticals: Information & Transaction Processing, Healthcare Solutions, and Legal and Loss Prevention Services [397]. Miscellaneous - The Company has implemented health and safety protocols and business continuity plans to mitigate the impact of COVID-19 on its operations [406]. - The Company conducts annual goodwill impairment tests on October 1st, with the option for qualitative or quantitative assessments to determine impairment [433]. - The Company evaluates its relationships with other entities to identify whether they are variable interest entities as defined by FASB ASC 810-10, and consolidation is required if both criteria are met [402].