MultiPlan (MPLN) - 2025 Q2 - Quarterly Report

Part I. Financial Information Item 1. Financial Statements For the first six months of 2025, the company reported slightly increased revenue and a significantly reduced net loss due to the absence of prior-year impairment charges, alongside a major debt refinancing that restructured its debt and impacted cash flows Unaudited Condensed Consolidated Balance Sheets As of June 30, 2025, total assets slightly decreased to $5.07 billion, total liabilities increased to $5.11 billion, and shareholders' equity shifted to a $39.9 million deficit from $84.0 million equity at year-end 2024, primarily due to net loss and debt refinancing Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Current Assets | $247,138 | $175,515 | | Cash and cash equivalents | $56,390 | $16,848 | | Total Assets | $5,071,980 | $5,150,827 | | Total Current Liabilities | $253,142 | $213,790 | | Total Liabilities | $5,111,888 | $5,066,805 | | Total Shareholders' Equity (Deficit) | ($39,908) | $84,022 | Unaudited Condensed Consolidated Statements of Loss and Comprehensive Loss For Q2 2025, revenues slightly increased to $241.6 million, and the company reported a significantly improved net loss of $62.6 million (or $3.81 per share) compared to $576.7 million in Q2 2024, primarily due to the absence of a $553.7 million goodwill impairment charge Statement of Loss Summary (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenues | $241,570 | $233,476 | $472,900 | $467,984 | | Operating Income (Loss) | $16,578 | ($523,927) | $26,320 | ($1,010,363) | | Loss on impairment | $0 | $553,701 | $0 | $1,072,751 | | Net Loss | ($62,640) | ($576,727) | ($133,959) | ($1,116,416) | | Net Loss Per Share | ($3.81) | ($35.78) | ($8.19) | ($69.18) | Unaudited Condensed Consolidated Statements of Shareholders' Equity Shareholders' equity transitioned from $84.0 million at year-end 2024 to a $39.9 million deficit as of June 30, 2025, primarily due to the $134.0 million net loss for the six-month period - The company's retained deficit increased from $(2,145.1) million at the end of 2024 to $(2,279.1) million at June 30, 2025, due to the net loss incurred during the first half of the year[21] Unaudited Condensed Consolidated Statements of Cash Flows For the six months ended June 30, 2025, net cash from operating activities decreased to $31.2 million, investing activities used $63.5 million, and financing activities provided $69.9 million, a significant reversal from the prior year, largely due to $130 million in new borrowings Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $31,181 | $68,187 | | Net Cash used in Investing Activities | ($63,489) | ($55,989) | | Net Cash from (used in) Financing Activities | $69,924 | ($34,523) | | Net Change in Cash | $37,616 | ($22,325) | Notes to Unaudited Condensed Consolidated Financial Statements The notes detail significant corporate actions, including the company's name change to Claritev Corporation, a 1-for-40 reverse stock split in 2024, a major debt refinancing in January 2025, and disclosures on revenue, goodwill (with no impairments in 2025), derivatives, and ongoing legal matters - On February 17, 2025, the company changed its name from "MultiPlan Corporation" to "Claritev Corporation" and its ticker symbol to "CTEV"[26] - A one-for-forty (1-for-40) reverse stock split of its Class A common stock became effective on September 20, 2024. All share and per-share data have been retroactively adjusted[29][30] - In January 2025, the company completed a major Refinancing Transaction, exchanging existing notes and term loans for new first lien term loans and notes with extended maturities, and establishing a new $350 million revolving credit facility[56] - The company recorded no goodwill impairment in the first six months of 2025, compared to a significant impairment loss of $1,072.8 million in the same period of 2024[42][75] Management's Discussion and Analysis of Financial Condition and Results of Operations Management reported a 1.1% revenue increase for the first six months of 2025, driven by Network-Based and Payment and Revenue Integrity Services, with a significantly narrowed net loss due to the absence of 2024 impairment charges, while a January 2025 debt refinancing extended maturities and Adjusted EBITDA slightly increased to $296.1 million - The company initiated its first international expansion into the Middle East and North Africa (MENA) region through a strategic partnership with Claims Care Revenue Cycle Management LLC[98] Revenue by Service Line (in thousands) | Service Line | Six Months 2025 | Six Months 2024 | Change % | | :--- | :--- | :--- | :--- | | Network-Based Services | $101,015 | $91,878 | +9.9% | | Analytics-Based Services | $310,396 | $319,988 | -3.0% | | Payment and Revenue Integrity | $61,489 | $56,118 | +9.6% | | Total Revenues | $472,900 | $467,984 | +1.1% | Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Metric | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | | Net loss | ($133,959) | ($1,116,416) | | Adjustments | $430,056 | $1,409,876 | | Adjusted EBITDA | $296,097 | $293,460 | - General and administrative expenses increased by 49.2% for the six months ended June 30, 2025, primarily due to $15.7 million in transformation costs and $5.5 million in losses on asset disposals[143] - As of June 30, 2025, the company had $67.3 million in cash and cash equivalents (including restricted cash) and $263.6 million of availability under its revolving credit facility[154] Quantitative and Qualitative Disclosures About Market Risk The company states that as of June 30, 2025, there have been no material changes in the market risks it faces compared to those described in its 2024 Annual Report - There were no material changes in the market risks described in the company's 2024 Annual Report as of June 30, 2025[188] Controls and Procedures Management concluded that disclosure controls and procedures were effective as of June 30, 2025, noting the implementation of a new enterprise resource planning (ERP) system during the quarter, which led to new and modified internal controls - The principal executive and financial officers concluded that disclosure controls and procedures were effective as of June 30, 2025[190] - During the second quarter of 2025, the company completed the implementation of a new enterprise resource planning (ERP) system, resulting in changes to its internal control over financial reporting[191] Part II - Other Information Legal Proceedings The company is involved in various legal proceedings arising from the ordinary course of business, which management does not expect to have a material adverse effect on its financial condition or operations - The company is a defendant in various lawsuits and regulatory investigations arising from the ordinary course of business but does not expect them to have a material adverse effect[194] Risk Factors While no material changes occurred to overall risk factors from the 2024 Annual Report, new risks emerged from international expansion, including challenges in managing foreign operations, complying with international laws, and increased susceptibility to global economic and political events - The company faces new risks associated with its international business expansion, including managing foreign operations, complying with international laws, and dealing with political or economic instability in foreign countries[201][206] - As the company expands its international footprint, it becomes more susceptible to global events beyond its control, such as changes in trade policy, military conflict, and public health crises[203] Other Information During the second quarter of 2025, no officers or directors of the company adopted or terminated any Rule 10b5-1 trading plans for the purchase or sale of company securities - No officers or directors adopted or terminated any Rule 10b5-1(c) trading arrangements during the three months ended June 30, 2025[208] Exhibits This section lists exhibits filed with the Form 10-Q, including certifications by the Principal Executive Officer and Principal Financial Officer as required by the Sarbanes-Oxley Act of 2002, and financial statements in Inline XBRL format - The report includes certifications from the CEO and CFO pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002[208]