EverCommerce(US:EVCM)2022-08-08 16:00Business Overview - EverCommerce serves over 600,000 customers across three core verticals: Home Services, Health Services, and Fitness & Wellness Services[129]. - The company has acquired 52 companies since inception to deepen competitive moats and enter new verticals and geographies[142]. Financial Performance - The Pro Forma Revenue Growth Rate was 16.1% and 18.0% for the three and six months ended June 30, 2022, respectively, indicating strong underlying business growth[150]. - Approximately 95% of revenue for the six months ended June 30, 2022, was recurring or re-occurring, with an annualized net revenue retention rate of over 100%[139]. - Adjusted Gross Profit for the three months ended June 30, 2022, was $102.1 million, compared to $80.2 million for the same period in 2021, reflecting a significant increase[153]. - Total revenues for the three months ended June 30, 2022, were $157.2 million, up from $121.1 million in the same period in 2021[155]. - Adjusted EBITDA for the three months ended June 30, 2022, was $30,749,000, compared to $27,573,000 for the same period in 2021, reflecting an increase of 7.9%[160]. - Total revenues increased by $36.2 million or 29.9% for the three months ended June 30, 2022, and $74.9 million or 33.1% for the six months ended June 30, 2022, compared to the same periods in 2021[179]. Revenue Breakdown - Subscription and transaction fees revenue increased by 35.8% for the three months ended June 30, 2022, totaling $115,648,000 compared to $85,136,000 in 2021[165]. - Marketing technology solutions revenue grew by 10.0% to $35,160,000 for the three months ended June 30, 2022, compared to $31,976,000 in 2021[165]. - Subscription and transaction fees contributed $30.5 million and $63.3 million to the revenue increases for the three and six months ended June 30, 2022, respectively[179]. Expenses and Losses - Cost of revenues for the three months ended June 30, 2022, was $55,103,000, an increase from $40,856,000 in the same period of 2021[176]. - Operating loss for the three months ended June 30, 2022, was $(6,104,000), an improvement from $(10,802,000) in the same period of 2021[176]. - Net loss for the three months ended June 30, 2022, was $(12,881,000), compared to $(24,334,000) for the same period in 2021, indicating a reduction of 47.2%[176]. - Sales and marketing expenses increased to $29,946,000 for the three months ended June 30, 2022, from $22,802,000 in 2021, reflecting a rise of 31.4%[176]. - Product development expenses rose to $17,423,000 for the three months ended June 30, 2022, compared to $12,047,000 in 2021, marking an increase of 44.8%[176]. - General and administrative expenses were $33,358,000 for the three months ended June 30, 2022, up from $31,923,000 in 2021, representing a growth of 4.5%[176]. Cash Flow and Capital Structure - As of June 30, 2022, the company had cash, cash equivalents, and restricted cash of $109.1 million, with $190.0 million of available borrowing capacity under its Revolver[196]. - During the six months ended June 30, 2022, net cash provided by operating activities was $24.0 million, compared to $3.8 million in the same period of 2021[197]. - Net cash used in investing activities was $9.1 million for the six months ended June 30, 2022, primarily driven by software development costs of $7.5 million[201]. - The company repurchased and retired 296,046 shares of common stock for $2.7 million during the three and six months ended June 30, 2022[217]. - As of June 30, 2022, there was $545.9 million outstanding under the Credit Facilities, with an effective interest rate of approximately 4.3% for the three months ended June 30, 2022[213]. Accounting and Compliance - The Company prepares its financial statements in accordance with GAAP, requiring estimates and assumptions that affect reported amounts of assets and liabilities[219]. - There were no material changes to the Company's critical accounting policies during the six months ended June 30, 2022, compared to those discussed in the Annual Report on Form 10-K[220]. - The Company qualifies as an "emerging growth company" under the JOBS Act, allowing it to adopt new or revised accounting guidance within the same time periods as private companies[222]. - The Company has elected to adopt new or revised accounting guidance within the same time period as private companies, which may complicate comparisons with non-emerging growth companies[223]. - There have been no material changes to the Company's disclosures regarding market risk as described in the Annual Report on Form 10-K[224]. Market Trends - The impact of COVID-19 has accelerated the digitization of customer interactions, positioning the company to capitalize on digital transformation trends[143].