Consensus(US:CCSI)2022-11-13 16:00Revenue Performance - Consensus reported revenues of $95,912,000 for the three months ended September 30, 2022, an increase of 8% compared to $89,198,000 for the same period in 2021[190]. - For the nine months ended September 30, 2022, revenues were $280,000,000, reflecting a 6% increase from $263,660,000 in the prior year[190]. - The corporate business segment saw a revenue increase of $8,000,000 or 19% in Q3 2022, contributing to overall growth, while the SoHo segment declined by $1,200,000 or 3%[191]. - Year-to-date, corporate business revenue increased by $20,600,000 or 16%, while the SoHo segment experienced a decline of $4,000,000 or 3%[192]. - Corporate business revenues increased by $20.6 million or 16% for the nine months ended September 30, 2022, including $5.3 million from the Summit acquisition[192]. - The corporate segment revenue for the three months ended September 30, 2022, was $51.2 million, compared to $43.2 million in 2021, marking an increase of approximately 18.5%[184]. - For the nine months ended September 30, 2022, total revenue was $280 million, up from $263.66 million in 2021, representing a year-over-year increase of approximately 6.5%[184]. Customer Metrics - Average Revenue per Account (ARPA) for corporate customers increased to $364.82 in Q3 2022 from $314.69 in Q3 2021, representing a growth of 15.9%[184]. - The total number of customer accounts for Consensus was 1,025,000 as of September 30, 2022, down from 1,109,000 in the same period of 2021[184]. - Monthly churn rate for corporate customers improved to 1.71% in Q3 2022 from 3.20% in Q3 2021, indicating better customer retention[184]. - The company reported a monthly churn rate of 3.51% for the consolidated segment in 2022, compared to 3.21% in 2021, indicating a slight increase in customer attrition[184]. - The average revenue per customer account (ARPA) for the consolidated segment increased to $30.84 in 2022 from $26.67 in 2021, reflecting a growth of about 15.5%[184]. Financial Expenses - Cost of revenues for the three months ended September 30, 2022, was $15.4 million, a 6% increase from $14.6 million in the same period of 2021[194]. - Sales and marketing expenses for the three months ended September 30, 2022, were $16.6 million, representing a 27% increase from $13.1 million in the prior year[196]. - Research, development, and engineering costs for the three months ended September 30, 2022, increased by 60% to $3.2 million from $2.0 million in the same period of 2021[199]. - General and administrative expenses for the three months ended September 30, 2022, were $25.6 million, a significant increase of 211% from $8.2 million in the prior year[200]. - Interest expense for the three months ended September 30, 2022, was $13.9 million, compared to $0.1 million in the same period of 2021, primarily due to outstanding debt[205]. Cash Flow and Liquidity - Cash and cash equivalents increased to $103.7 million as of September 30, 2022, from $66.8 million at December 31, 2021[212]. - Net cash provided by operating activities for the nine months ended September 30, 2022, was $89.3 million, down from $196.4 million in the same period of 2021[218]. - The company anticipates that existing cash and cash equivalents will be sufficient to meet its needs for at least the next 12 months[214]. - The Company has a senior secured revolving credit facility of $25 million, with an option for an additional $25 million, maturing on March 4, 2027[213]. - Net cash used in financing activities was $(8.9) million for the nine months ended September 30, 2022, compared to $14.4 million in 2021, mainly due to stock repurchases and tax-related share surrenders[222]. Tax and Obligations - The effective tax rate for the three months ended September 30, 2022, was 28.8%, up from 21.9% in the same period of 2021[209]. - As of September 30, 2022, the company had a total liability for uncertain tax positions amounting to $7.0 million[225]. - Total contractual obligations as of September 30, 2022, amounted to $1,121.8 million, which includes long-term debt principal and interest, operating leases, and other commitments[224]. Strategic Initiatives - The company plans to grow both organically and through opportunistic acquisitions to enhance its product offerings in the interoperability space[189]. - The company aims to expand its Cloud Fax business internationally, despite facing risks such as currency fluctuations and regulatory challenges[176]. - The company completed its separation into two publicly traded entities, with Consensus focusing on secure information delivery services and interoperability solutions[179]. - The company approved a share buyback program allowing for the repurchase of up to $100 million worth of common stock through February 2025[215].