Clarivate(CLVT) - 2024 Q4 - Annual Report

Revenue Performance - Total revenues for 2024 were $2,556.7 million, a decrease of 2.7% compared to$ 2,628.8 million in 2023[224]. - Revenues for 2024 were $2,556.7 million, a decrease of$ 72.1 million or 2.7% compared to 2023[156]. - Subscription revenues increased slightly to $1,626.8 million in 2024 from$ 1,618.1 million in 2023, while transactional revenues decreased to $500.1 million from$ 566.1 million[281]. - The Americas segment revenues decreased by $24.1 million or 1.7%, primarily due to lower contributions from A&G and LS&H[161]. - Revenues denominated in non-U.S. dollar currencies represented approximately 26% of total revenues for 2024, with a 10% change in the Euro and British pound potentially impacting annual revenues by approximately$ 50 million[203]. Contract Value and Renewal Rates - Organic annualized contract value (ACV) grew by 0.9% in 2024 compared to 2023, primarily driven by price increases[128]. - Total ACV declined by 1.1% in 2024 compared to 2023, mainly due to the divestiture of ScholarOne in November 2024[128]. - The annual renewal rate for both 2024 and 2023 remained stable at 92%[130]. Goodwill and Impairment Charges - Total goodwill impairment charges recorded for 2024 amounted to $451.9 million, primarily due to declines in market conditions and share price[144]. - Goodwill impairment charges were$ 465.7 million in 2024, down from $847.7 million in 2023, primarily due to declines in share price and market conditions[169]. - Goodwill impairment charges totaled$ 540.7 million in 2024, down from $979.9 million in 2023, indicating a reduction in asset write-downs[224]. - The company performed goodwill impairment assessments using a discounted cash flow model, with a WACC discount rate of 10.5% for A&G and 9% for LS&H[145]. - A 50 basis point increase in the discount rate could have resulted in an additional impairment charge of approximately$ 62 million for the LS&H reporting unit[145]. Financial Performance and Income - Net income attributable to ordinary shares was a loss of $668.0 million in 2024, an improvement from a loss of$ 986.6 million in 2023[156]. - The net income (loss) for 2024 was $(636.7) million, an improvement from$ (911.2) million in 2023, reflecting a decrease in losses[184]. - The company reported a net loss of $636.7 million for 2024, compared to a net loss of$ 911.2 million in 2023, reflecting an improvement in financial performance[224]. - Comprehensive loss for 2024 was $(667.7) million, compared to$ (740.6) million in 2023 and $(4,952.8) million in 2022[227]. Cash Flow and Capital Expenditures - Free cash flow for 2024 was$ 357.5 million, down from $501.7 million in 2023, attributed to lower operating results and increased capital spending[190]. - Net cash provided by operating activities decreased by 13% to$ 646.6 million in 2024 from $744.2 million in 2023, primarily due to lower operating results and higher working capital requirements[188]. - The company expects capital expenditures of approximately$ 255 million in 2025, primarily for product and content development[197]. - Cash and cash equivalents at the end of 2024 were $295.2 million, down from$ 370.7 million at the end of 2023[231]. Operating Expenses - Total operating expenses decreased to $2,832.3 million in 2024, down from$ 3,363.5 million in 2023[156]. - Selling, general and administrative costs decreased by 1.6% compared to 2023, but as a percentage of revenues, they increased by 0.4%[165]. - Depreciation and amortization expenses increased by 2.6% compared to 2023, driven by increased investment in internally developed software and content assets[167]. Debt and Financing - Long-term debt was reported at $4,518.7 million in 2024, a slight decrease from$ 4,721.1 million in 2023, indicating efforts to manage debt levels[222]. - The total debt outstanding as of December 31, 2024, was $4,571.1 million, down from$ 4,770.3 million as of December 31, 2023[311]. - The company refinanced its credit facilities in January 2024, extending debt maturities and lowering annual cash interest costs[192]. - The refinancing provides improved financial flexibility, extending debt maturities and lowering annual cash interest costs[317]. Impairment and Restructuring - The company recorded an intangible assets impairment charge of $75.0 million in December 2024 related to the wind-down of three product groups[169]. - Restructuring and other impairments totaled$ 540.3 million in 2024, a decrease from $986.2 million in 2023[231]. - The company expects to incur approximately$ 30 million in additional restructuring costs associated with the Value Creation Plan, primarily during 2025[173]. Foreign Currency and Translation - The net foreign exchange loss for 2024 was $4.2 million, compared to a gain of$ 38.9 million in 2023[269]. - The company reported a foreign currency translation adjustment loss of $(24.7) million in 2024, compared to a gain of$ 193.6 million in 2023[227]. Internal Controls and Compliance - The company maintained effective internal control over financial reporting as of December 31, 2024, according to the independent auditor's opinion[210]. - As of December 31, 2024, the company was in compliance with all indenture covenants[314].