Verra Mobility(US:VRRM)2019-05-06 21:48Revenue Growth - Service revenue increased from $69.0 million in Q1 2018 to $98.1 million in Q1 2019, a growth of 42.1%[130] - Total revenue for Q1 2019 was $98.5 million, up 42.2% from $69.2 million in Q1 2018[148] - Service revenue increased by $29.1 million, or 42.1%, to $98.1 million for the three months ended March 31, 2019, compared to $69.0 million for the same period in 2018[150] - Commercial Services revenue rose by $30.1 million, or 92.9%, from $32.4 million in Q1 2018 to $62.6 million in Q1 2019, with acquisitions contributing $21.6 million to this growth[150] - Government Solutions service revenue decreased by $1.1 million, or 2.9%, to $35.5 million, primarily due to a decline in red light program revenues[151] Profitability - Net income improved significantly from a loss of $22.2 million in Q1 2018 to a net income of $2.8 million in Q1 2019[148] - Operating income for Q1 2019 was $18.0 million, a significant turnaround from an operating loss of $7.3 million in Q1 2018[148] - Net income for Q1 2019 was $2.8 million, a significant improvement from a net loss of $22.2 million in Q1 2018, largely due to reduced acquisition-related expenses[161] - Net income increased by $25.0 million, from a loss of $22.2 million in Q1 2018 to income of $2.8 million in Q1 2019, driven by full-period results from HTA and EPC operations[169] Operating Expenses - Operating expenses as a percentage of total revenue decreased from 34.2% in Q1 2018 to 29.8% in Q1 2019[130] - Operating expenses increased by $5.7 million, or 23.9%, from $23.7 million in Q1 2018 to $29.3 million in Q1 2019, but as a percentage of revenue, they decreased from 34.2% to 29.8%[156] - Total selling, general and administrative expenses decreased by $12.7 million to $20.6 million in Q1 2019, down from $33.3 million in Q1 2018[157] Cash Flow - Cash flows from operating activities for Q1 2019 were $37.4 million, recovering from the $15.6 million impact of HTA acquisition expenses in Q1 2018[130] - Cash provided by operating activities increased by $40.6 million from $(3.2) million in Q1 2018 to $37.4 million in Q1 2019[168] - Cash used in investing activities decreased significantly from $(537.4) million in Q1 2018 to $(9.2) million in Q1 2019, primarily due to the HTA acquisition costs in the prior year[172] - Cash provided by financing activities changed from $548.0 million in Q1 2018 to $(2.3) million in Q1 2019, mainly due to the entry into the 2018 Credit Facilities in the prior year[173] Debt and Financing - The average debt balance increased from $744.2 million in Q1 2018 to $902.4 million in Q1 2019, contributing to a rise in interest expense by $3.4 million[158] - The company had $70.0 million available for borrowing under its revolving credit facility as of March 31, 2019[166] - Total borrowing under the New First Lien Term Loan was $901 million as of March 31, 2019, with an interest rate of 6.25%[202] - Each 1% movement in interest rates will result in an approximately $9.0 million change in annual interest expense based on the New First Lien Term Loan balance[202] - The company incurred $16.033 million in interest expense for Q1 2019, up from $12.647 million in Q1 2018[199] Strategic Acquisitions - The company completed strategic acquisitions, including Highway Toll Administration for $603.3 million and Euro Parking Collection for $62.9 million[130] Adjusted EBITDA - Adjusted EBITDA for Q1 2019 was $51.3 million, representing a 51.7% increase from $33.8 million in Q1 2018[148] - Adjusted EBITDA for Q1 2019 was $51.255 million, compared to $33.781 million in Q1 2018, representing a year-over-year increase of 51.8%[199] Other Financial Metrics - The company recognized a charge of $10.2 million in Q1 2018 related to the extinguishment of the Old Term Loans and associated costs[182] - The company reported a depreciation and amortization expense of $28.939 million in Q1 2019, compared to $18.550 million in Q1 2018[199] - Stock-based compensation for Q1 2019 was $2.143 million, reflecting non-cash charges related to the 2018 Equity Incentive Plan[201] - Transformation expenses in Q1 2018 included one-time costs related to optimizing the expense structure and defining the company's growth strategy[200] - The company did not engage in any hedging activities during Q1 2019 and does not expect to do so in the future[203] - Remaining performance obligations in the Government Solutions segment amounted to approximately $0.3 million as of March 31, 2019, expected to be recognized over a two-month period[190]