Dun & Bradstreet(DNB) - 2022 Q1 - Quarterly Report

PART I. FINANCIAL INFORMATION Item 1. Condensed Consolidated Financial Statements (Unaudited) This chapter provides the company's unaudited condensed consolidated financial statements for the three months ended March 31, 2022, and March 31, 2021, including statements of operations and comprehensive income (loss), balance sheets, cash flows, and stockholders' equity, along with detailed notes covering accounting policies, revenue recognition, restructuring charges, debt, contingencies, income taxes, pensions, stock-based compensation, earnings per share, financial instruments, accumulated other comprehensive income, acquisitions, goodwill and intangible assets, segment information, and related party transactions Condensed Consolidated Statement of Operations and Comprehensive Income (Loss) (Unaudited) This section presents the unaudited condensed consolidated statement of operations and comprehensive income (loss) for the three months ended March 31, 2022, and 2021, detailing revenue, operating costs, and net income (loss) Condensed Consolidated Statement of Operations and Comprehensive Income (Loss) (Unaudited) | Metric (million USD) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :------------------- | :-------------------------------- | :-------------------------------- | | Revenue | 536.0 | 504.5 | | Operating Costs | 519.6 | 496.2 | | Operating Income (Loss) | 16.4 | 8.3 | | Net Income (Loss) | (29.8) | (23.3) | | Net Income (Loss) Attributable to Dun & Bradstreet Holdings, Inc. | (31.3) | (25.0) | | Basic Earnings (Loss) Per Share | (0.07) | (0.06) | | Diluted Earnings (Loss) Per Share | (0.07) | (0.06) | - The company achieved revenue of $536.0 million in Q1 2022, a 6.2% year-over-year increase, but net loss attributable to Dun & Bradstreet Holdings, Inc. expanded to $31.3 million, with a loss per share of $0.07[8] Condensed Consolidated Balance Sheets (Unaudited) This section provides the unaudited condensed consolidated balance sheets as of March 31, 2022, and December 31, 2021, outlining assets, liabilities, and stockholders' equity Condensed Consolidated Balance Sheets (Unaudited) | Metric (million USD) | March 31, 2022 | December 31, 2021 | | :------------------- | :------------- | :---------------- | | Cash and Cash Equivalents | 215.8 | 177.1 | | Total Current Assets | 732.3 | 718.0 | | Total Non-Current Assets | 9,124.9 | 9,279.2 | | Total Assets | 9,857.2 | 9,997.2 | | Total Current Liabilities | 973.4 | 1,004.9 | | Total Liabilities | 6,148.3 | 6,251.9 | | Total Stockholders' Equity | 3,643.5 | 3,681.2 | | Total Liabilities and Stockholders' Equity | 9,857.2 | 9,997.2 | - As of March 31, 2022, total assets were $9,857.2 million, a slight decrease from December 31, 2021, primarily due to a reduction in non-current assets, while cash and cash equivalents increased to $215.8 million[12] Condensed Consolidated Statements of Cash Flows (Unaudited) This section presents the unaudited condensed consolidated statements of cash flows for the three months ended March 31, 2022, and 2021, detailing cash flows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (Unaudited) | Cash Flow Type (million USD) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--------------------------- | :-------------------------------- | :-------------------------------- | | Net Cash from Operating Activities | 138.8 | 168.2 | | Net Cash from Investing Activities | (49.4) | (637.9) | | Net Cash from Financing Activities | (51.0) | 290.1 | | Cash and Cash Equivalents at End of Period | 215.8 | 173.4 | - Net cash flow from operating activities was $138.8 million in Q1 2022, a decrease from the prior year, while investing cash outflows significantly reduced due to the absence of major acquisitions like Bisnode in 2021, and financing cash outflows of $51.0 million were primarily driven by debt redemption activities[16] Condensed Consolidated Statements of Stockholder Equity (Unaudited) This section provides the unaudited condensed consolidated statements of stockholder equity as of March 31, 2022, detailing changes in capital stock, accumulated deficit, and other comprehensive income (loss) Condensed Consolidated Statements of Stockholder Equity (Unaudited) | Stockholders' Equity Item (million USD) | March 31, 2022 | | :------------------------------------ | :------------- | | Common Stock | — | | Additional Paid-in Capital | 4,506.8 | | Accumulated Deficit | (793.1) | | Treasury Stock | (0.3) | | Accumulated Other Comprehensive Loss | (69.9) | | Total Stockholders' Equity | 3,643.5 | | Noncontrolling Interests | 65.4 | | Total Equity | 3,708.9 | - As of March 31, 2022, total stockholders' equity was $3,643.5 million, a decrease from $3,681.2 million on January 1, 2022, primarily impacted by net loss and foreign currency translation adjustments[20] Notes to Condensed Consolidated Financial Statements (Unaudited) This section provides detailed notes to the unaudited condensed consolidated financial statements, covering accounting policies, revenue recognition, debt, contingencies, and other key financial disclosures Note 1 -- Basis of Presentation The company's condensed consolidated financial statements are prepared in accordance with GAAP and should be read in conjunction with the 2021 annual report, with business segmented into North America and International, and potential impacts from COVID-19 and the Russia-Ukraine conflict noted - The company's business is segmented into North America and International, providing finance & risk and sales & marketing data, analytics, and business insights[22] - The COVID-19 pandemic and the Russia-Ukraine conflict continue to create economic uncertainties, potentially affecting management's estimates and assumptions[22] Note 2 -- Recent Accounting Pronouncements The company has evaluated recent accounting pronouncements, including the early adoption of ASU No. 2021-08 in Q4 2021 for contract assets and liabilities in business combinations, and the availability of optional simplifications for LIBOR transition under ASU No. 2020-04 and ASU 2021-01 - The company early adopted ASU No. 2021-08 in Q4 2021, requiring contract assets and liabilities in business combinations to be recognized and measured under ASC 606 instead of fair value, resulting in no fair value adjustment for acquired deferred revenue balances in 2021 acquisitions[24][26] - FASB issued ASU No. 2020-04 and ASU 2021-01, providing temporary optional expedients to ease the financial reporting burden of the LIBOR transition to alternative reference rates, which the company may prospectively apply through December 31, 2022[27] Note 3 -- Revenue As of March 31, 2022, the total transaction price of contracts with unsatisfied (or partially unsatisfied) performance obligations was $2,857.6 million, with revenue recognized at a point in time at $208.8 million and over time at $327.2 million in Q1 2022, and deferred revenue increased to $632.8 million from $569.4 million at December 31, 2021 Revenue Recognition Timing | Revenue Recognition Timing (million USD) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :------------------------------------- | :-------------------------------- | :-------------------------------- | | Revenue Recognized at a Point in Time | 208.8 | 205.0 | | Revenue Recognized Over Time | 327.2 | 299.5 | | Total Revenue | 536.0 | 504.5 | Contract Balances | Contract Balances (million USD) | March 31, 2022 | December 31, 2021 | | :------------------------------ | :------------- | :---------------- | | Accounts Receivable, Net | 339.4 | 401.7 | | Current Contract Assets | 4.0 | 3.4 | | Non-Current Contract Assets | 12.3 | 9.1 | | Current Deferred Revenue | 632.8 | 569.4 | | Non-Current Deferred Revenue | 17.3 | 13.7 | - Total future revenue from unsatisfied performance obligations was $2,857.6 million as of March 31, 2022[28] - Deferred revenue increased from $569.4 million as of December 31, 2021, to $632.8 million as of March 31, 2022, primarily due to cash payments received in advance[32] Note 4 -- Restructuring Charge The company recorded $5.3 million in restructuring charges in Q1 2022, a decrease from $5.8 million in the prior year, primarily comprising $2.5 million in employee severance and $2.8 million in contract termination and other exit costs, with a restructuring reserve balance of $7.1 million as of March 31, 2022 Restructuring Charges | Restructuring Charges (million USD) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Severance and Termination Costs | 2.5 | 4.7 | | Contract Termination and Other Exit Costs | 2.8 | 1.1 | | Total Restructuring Charges | 5.3 | 5.8 | Restructuring Reserve | Restructuring Reserve (million USD) | March 31, 2022 | | :---------------------------------- | :------------- | | Balance as of December 31, 2021 | 8.0 | | Charges in Q1 2022 | 3.1 | | Payments in Q1 2022 | (4.0) | | Balance as of March 31, 2022 | 7.1 | Note 5 -- Notes Payable and Indebtedness As of March 31, 2022, total debt was $3,721.4 million, slightly down from $3,744.8 million at December 31, 2021, following a January 2022 credit agreement amendment that established a $460.0 million incremental term loan to redeem $420.0 million of 6.875% Senior Secured Notes, resulting in a $23.0 million loss on debt extinguishment, and a $250.0 million notional interest rate swap was entered into in March 2022 to hedge future cash flow variability of floating-rate debt Notes Payable and Indebtedness | Debt Type (million USD) | Carrying Value as of March 31, 2022 | Carrying Value as of December 31, 2021 | | :-------------------- | :---------------------------------- | :------------------------------------- | | Current Debt | 32.7 | 28.1 | | Long-Term Debt | 3,688.7 | 3,716.7 | | Total Debt | 3,721.4 | 3,744.8 | - On January 18, 2022, the company amended its credit agreement, establishing a $460.0 million incremental term loan due 2029, used to redeem $420.0 million of 6.875% Senior Secured Notes, resulting in a $23.0 million loss on debt extinguishment[45] - The company entered into a three-year interest rate swap agreement with a total notional amount of $250.0 million on March 2, 2022, to hedge future cash flow variability of floating-rate debt[50][53] Note 6 -- Other Assets and Liabilities This note details the composition of other non-current assets, other accrued and current liabilities, and other non-current liabilities as of March 31, 2022, and December 31, 2021, showing slight decreases across these categories Other Assets and Liabilities | Item (million USD) | March 31, 2022 | December 31, 2021 | | :----------------- | :------------- | :---------------- | | Other Non-Current Assets | 166.9 | 172.6 | | Other Accrued and Current Liabilities | 170.7 | 198.3 | | Other Non-Current Liabilities | 139.1 | 144.7 | Note 7 -- Contingencies The company is involved in various legal and regulatory matters, including commercial disputes, defamation claims, and employment claims, with the FTC investigation concluding with a consent order in April 2022, and two class action lawsuits regarding unauthorized use of names and likenesses on Hoovers product websites currently in early stages of investigation with no loss provision recorded - The Federal Trade Commission (FTC) investigation into potential violations of Section 5 of the FTC Act was finalized with a consent order on April 6, 2022, with related amounts accrued in Q1 2021[63][64] - The company faces two class action lawsuits (DeBose v. Dun & Bradstreet Holdings, Inc. and Batis v. Dun & Bradstreet Holdings, Inc.) regarding the unauthorized use of names and likenesses on Hoovers product websites, which are in early stages of investigation, and no loss provision has been recorded as the loss is not yet probable or estimable[65][67][68][69] Note 8 -- Income Taxes The company's effective tax rate for Q1 2022 was 23.4%, with a tax benefit of $9.3 million, lower than Q1 2021's 29.0% and $9.8 million, primarily due to the inclusion of Global Intangible Low-Taxed Income (GILTI) and higher non-deductible executive compensation, partially offset by tax benefits from increased income in foreign jurisdictions Income Tax Metrics | Tax Metric (million USD) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :----------------------- | :-------------------------------- | :-------------------------------- | | Income (Loss) Before Income Taxes | (39.8) | (33.7) | | Provision for Income Taxes (Benefit) | (9.3) | (9.8) | | Effective Tax Rate | 23.4% | 29.0% | - The effective tax rate decreased to 23.4% in Q1 2022, primarily influenced by the inclusion of GILTI and non-deductible executive compensation, partially offset by increased income in foreign jurisdictions[70] Note 9 -- Pension and Postretirement Benefits The company's net periodic pension cost (benefit) for Q1 2022 was a benefit of $10.4 million, a decrease from a benefit of $12.1 million in Q1 2021, mainly due to changes in service cost and expected return on plan assets Net Periodic Cost (Benefit) Components | Net Periodic Cost (Benefit) Components (million USD) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :----------------------------------- | :-------------------------------- | :-------------------------------- | | Service Cost | 0.8 | 1.3 | | Interest Cost | 8.8 | 6.8 | | Expected Return on Plan Assets | (20.0) | (20.8) | | Net Periodic Cost (Benefit) | (10.4) | (12.1) | Note 10 -- Stock Based Compensation Total stock-based compensation expense for Q1 2022 was $10.7 million, up from $7.6 million in Q1 2021, primarily comprising restricted stock and restricted stock units, stock options, and incentive units, with $97.6 million in unrecognized stock-based compensation expense as of March 31, 2022, to be amortized over a weighted-average period of 2.2 years Stock-Based Compensation Expense | Stock-Based Compensation Expense (million USD) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :------------------------------------------- | :-------------------------------- | :-------------------------------- | | Restricted Stock and Restricted Stock Units | 7.4 | 6.6 | | Stock Options | 1.0 | 1.0 | | Incentive Units | 2.3 | — | | Total Compensation Expense | 10.7 | 7.6 | - As of March 31, 2022, total unrecognized stock-based compensation expense was $97.6 million, with a weighted-average amortization period of 2.2 years[76] Note 11 -- Earnings (Loss) Per Share The company's basic and diluted loss per share attributable to Dun & Bradstreet Holdings, Inc. for Q1 2022 was $0.07, slightly higher than $0.06 in Q1 2021, with 434,115,063 shares of common stock outstanding as of March 31, 2022 Earnings (Loss) Per Share Metrics | Earnings (Loss) Per Share Metric | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :------------------------------- | :-------------------------------- | :-------------------------------- | | Basic Earnings (Loss) Per Share | (0.07) | (0.06) | | Diluted Earnings (Loss) Per Share | (0.07) | (0.06) | - As of March 31, 2022, the number of common shares outstanding was 434,115,063[82] Note 12 -- Financial Instruments The company uses financial instruments to manage interest rate and foreign currency risks, not for trading or speculative purposes, with $1,250.0 million notional interest rate swaps designated as cash flow hedges and $383.1 million notional foreign currency forward contracts not designated as hedging instruments as of March 31, 2022, and the fair value of interest rate swap assets increased from $10.1 million at December 31, 2021, to $42.4 million at March 31, 2022 - The company uses foreign currency forward and option contracts to hedge short-term foreign currency denominated loans and transactions, and may use interest rate derivatives to hedge interest rate risk on debt, not for trading or speculative purposes[83][84] Notional Amounts of Financial Instruments | Financial Instrument Notional Amount (million USD) | March 31, 2022 | December 31, 2021 | | :----------------------------------------------- | :------------- | :---------------- | | Interest Rate Swaps (Hedging Instruments) | 1,250.0 | 1,000.0 | | Foreign Currency Forward Contracts (Non-Hedging Instruments) | 383.1 | 448.5 | Fair Value of Derivative Financial Instruments | Derivative Financial Instrument Fair Value (million USD) | March 31, 2022 | December 31, 2021 | | :----------------------------------------------------- | :------------- | :---------------- | | Interest Rate Swap Assets | 42.4 | 10.1 | | Foreign Currency Forward Assets | 0.7 | 1.9 | | Foreign Currency Forward Liabilities | 1.0 | 0.7 | Note 13 -- Accumulated Other Comprehensive Income (Loss) As of March 31, 2022, the company's accumulated other comprehensive loss was $69.9 million, an increase from $57.1 million on January 1, 2022, primarily due to the negative impact of foreign currency translation adjustments, partially offset by gains on derivative financial instruments Components of Accumulated Other Comprehensive Income (Loss) | Components of Accumulated Other Comprehensive Income (Loss) (million USD) | March 31, 2022 | January 1, 2022 | | :---------------------------------------------------- | :------------- | :-------------- | | Foreign Currency Translation Adjustments | (88.9) | (52.6) | | Defined Benefit Pension Plans | (12.0) | (11.9) | | Derivative Financial Instruments | 31.0 | 7.4 | | Total | (69.9) | (57.1) | - Foreign currency translation adjustments contributed to a $36.3 million increase in accumulated other comprehensive loss in Q1 2022[103] Note 14 -- Acquisitions In 2021, the company completed three significant acquisitions: Eyeota Holdings Pte Ltd for $172.4 million cash on November 5, NetWise Data, LLC for $69.8 million on November 15, and Bisnode Business Information Group AB for $805.8 million (cash plus stock) on January 8, aiming to enhance its targeted marketing business and European market presence, and expand its data cloud, with the allocation of Eyeota and NetWise acquisitions still preliminary - On November 5, 2021, the company acquired Eyeota Holdings Pte Ltd, a global online and offline data integration and transformation company, for $172.4 million in cash, with goodwill allocated to the North America segment[105][106][109] - On November 15, 2021, the company acquired NetWise Data, LLC, a provider of B2B and B2C identity graph and audience targeting data, for $69.8 million, with goodwill allocated to the North America segment[113][114][118] - On January 8, 2021, the company acquired Bisnode Business Information Group AB, a leading European data and analytics company, for $805.8 million ($646.9 million cash and $158.9 million stock), expanding its European operations and data cloud[121] Note 15 -- Goodwill and Intangible Assets) As of March 31, 2022, total goodwill was $3,475.4 million and total other intangible assets were $4,689.7 million, with changes primarily influenced by acquisitions such as Eyeota and NetWise, and foreign currency fluctuations Goodwill and Intangible Assets | Asset Type (million USD) | March 31, 2022 | January 1, 2022 | | :----------------------- | :------------- | :-------------- | | Computer Software | 563.4 | 557.4 | | Goodwill | 3,475.4 | 3,493.3 | | Other Intangible Assets | 4,689.7 | 4,824.5 | - Acquisitions of Eyeota and NetWise added $0.5 million to goodwill in Q1 2022[129][133] Note 16 -- Segment Information The company manages its business and reports financial results through two segments: North America and International, with North America revenue at $367.3 million and International revenue at $168.7 million in Q1 2022, and adjusted EBITDA for North America at $153.3 million and International at $55.1 million, with adjusted EBITDA used as the primary measure of ongoing operating profitability - The company's business is segmented into North America and International, providing finance & risk and sales & marketing data, analytics, and business insights[135] Segment Revenue | Segment Revenue (million USD) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :---------------------------- | :-------------------------------- | :-------------------------------- | | North America | 367.3 | 339.4 | | International | 168.7 | 169.9 | | Consolidated Total | 536.0 | 504.5 | Segment Adjusted EBITDA | Segment Adjusted EBITDA (million USD) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :------------------------------------ | :-------------------------------- | :-------------------------------- | | North America | 153.3 | 151.0 | | International | 55.1 | 51.5 | | Consolidated Total | 190.1 | 185.6 | - The company uses adjusted EBITDA as the primary measure of ongoing operating profitability, excluding depreciation, amortization, interest, taxes, non-operating income/expenses, stock-based compensation, and other items[137] Note 17 -- Related Parties The company is jointly controlled by an investor consortium (Bilcar, THL, Cannae Holdings, Black Knight, and CC Capital) with significant voting influence, and has agreements with Black Knight for data licensing and product services, and with Paysafe for data licensing and risk management solutions, recognizing $0.9 million in revenue from Paysafe in Q1 2022 - An investor consortium (Bilcar, THL, Cannae Holdings, Black Knight, CC Capital) holds significant voting influence over the company and can designate five board members[148] - The company has a five-year agreement with Black Knight, where D&B will receive approximately $24.0 million in data licensing fees and pay approximately $34.0 million for product and professional services[150] - The company has a ten-year agreement with Paysafe, providing data licensing and risk management solutions, recognizing $0.9 million in revenue in Q1 2022[150] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Unaudited) This chapter provides management's discussion and analysis of the company's financial condition and results of operations for the three months ended March 31, 2022, including business overview, recent developments, key operating components, non-GAAP financial measures, and liquidity and capital resources, reporting a 6.2% total revenue growth, 2.4% adjusted EBITDA growth, but an expanded GAAP net loss, and discussing segment performance, debt refinancing, and the impacts of the Russia-Ukraine conflict and COVID-19 Forward-Looking Statements and Risk Factors This section contains forward-looking statements whose results may differ materially from projections, and lists risks and uncertainties that could affect the company's future business and financial performance, including strategic plan execution, market competition, brand reputation, global economic conditions, cybersecurity, data integrity, system failures, data source access, reliance on strategic alliances, intellectual property protection, government regulatory compliance, the COVID-19 pandemic, and economic uncertainties from the Russia-Ukraine conflict - Forward-looking statements are based on management's beliefs and available information, and actual results may differ materially from projections[153] - Risk factors include the ability to execute strategic plans, market competition, damage to brand reputation, global economic conditions (e.g., COVID-19 and Russia-Ukraine conflict), cybersecurity incidents, data or system integrity issues, limited access to data sources, and reliance on strategic alliances[154] Business Overview Dun & Bradstreet is a leading global provider of business decision data and analytics, helping clients transform uncertainty into confidence through its Finance & Risk and Sales & Marketing solutions, serving over 200,000 global customers across North America, Europe, Greater China, and India, with a highly recurring, diversified revenue base, significant operating leverage, low capital requirements, and strong free cash flow - Dun & Bradstreet is a leading global provider of business decision data and analytics, helping clients make informed decisions through Finance & Risk and Sales & Marketing solutions[156][157][160] - The company serves over 200,000 global customers, with operations spanning North America, Europe, Greater China, and India, and has expanded its data cloud through the acquisition of Bisnode[161] - The company's business model features highly recurring, diversified revenue, significant operating leverage, low capital requirements, and strong free cash flow[162] Segments The company manages its business and reports financial results through two segments: North America, serving the US and Canadian markets with finance & risk and sales & marketing data, analytics, and business insights, and International, providing similar services in the UK, Ireland, Nordics, DACH region, Central and Eastern Europe, Greater China, India, and through its Worldwide Network Alliance - The company's business is divided into two segments: North America and International[164] - The North America segment serves the US and Canadian markets, while the International segment covers the UK, Ireland, Nordics, DACH region, Central and Eastern Europe, Greater China, India, and the Worldwide Network Alliance[164] Recent Developments The company recently refinanced debt by establishing a $460.0 million incremental term loan due 2029 to redeem $420.0 million of 2026 Senior Secured Notes, and continues to monitor the potential impacts of the Russia-Ukraine conflict and the COVID-19 pandemic on the global economy and supply chains, with future uncertainties remaining despite limited current operational and financial impact - On January 18, 2022, the company amended its credit agreement, establishing a $460.0 million incremental term loan due 2029, used to redeem $420.0 million of 6.875% Senior Secured Notes[165] - The Russia-Ukraine conflict has increased global economic uncertainty; while the company has no significant operations or customers in the region, an escalation or expansion of sanctions could adversely affect customers, suppliers, and financial markets[166][168] - The COVID-19 pandemic continues to cause economic disruptions and market volatility; the company has successfully adopted a distributed work model, but the duration of the pandemic and pace of recovery remain uncertain[169][170] Key Components of Results of Operations This section details the key components of the company's results of operations, including revenue primarily from subscription-based contracts for Finance & Risk and Sales & Marketing solutions, cost of services covering data acquisition and operational costs, selling and administrative expenses for personnel and professional services, depreciation and amortization for property, plant, and equipment and acquired intangible assets, non-operating income and expenses, and provision for income taxes - Revenue is primarily generated through subscription-based contracts, providing data, analytics, and related services, categorized into Finance & Risk and Sales & Marketing solutions[172][173][174] - Cost of services primarily includes data acquisition and royalty fees, database-related costs, service fulfillment costs, and technology support costs[175] - Selling and administrative expenses primarily include personnel costs for sales, administrative, and corporate staff, professional and consulting service fees, and advertising expenses[177] - Depreciation and amortization expenses include depreciation of property, plant, and equipment, and amortization of software and intangible assets (primarily databases and customer relationships) arising from acquisitions, particularly the Bisnode acquisition[178] Key Metrics (Non-GAAP Financial Measures) The company uses non-GAAP financial measures such as Adjusted Revenue, Organic Revenue, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, and Adjusted Diluted EPS to assess performance, adjusting for non-core items like acquisition and divestiture-related revenue and expenses, restructuring charges, stock-based compensation, debt extinguishment costs, and purchase accounting amortization to provide a clearer view of ongoing operating performance - Adjusted Revenue includes revenue adjustments due to the timing of the Bisnode acquisition and excludes the impact of foreign currency fluctuations[184] - Organic Revenue is defined as Adjusted Revenue excluding the impact of foreign currency and revenue from acquired businesses (for the first 12 months) and divested businesses, to reflect underlying revenue trends[185] - Adjusted EBITDA excludes depreciation, amortization, interest, taxes, non-operating income/expenses, stock-based compensation, restructuring charges, acquisition-related costs, transformation costs, significant legal fees, and asset impairments[186] - Adjusted Net Income and Adjusted Diluted EPS are calculated by adjusting for non-GAAP items such as intangible asset amortization from purchase accounting, stock-based compensation, restructuring charges, acquisition-related costs, debt refinancing and extinguishment costs, and related tax impacts[189][190] Results of Operations (GAAP and Non-GAAP) In Q1 2022, total revenue was $536.0 million, up 6.2% year-over-year, with Adjusted Revenue growing 5.3% and Organic Revenue growing 4.5%, while GAAP net loss expanded to $31.3 million, Adjusted Net Income increased 4.9% to $102.5 million, and Adjusted Diluted EPS was $0.24, with North America revenue up 8.2% and International revenue down 0.7% (up 4.2% excluding FX), and Adjusted EBITDA increased 2.4% to $190.1 million but Adjusted EBITDA Margin decreased 100 basis points to 35.5% Results of Operations (GAAP and Non-GAAP) | Metric (million USD) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :------------------- | :-------------------------------- | :-------------------------------- | | Revenue | 536.0 | 504.5 | | Adjusted Revenue | 536.0 | 509.1 | | Organic Revenue | 528.8 | 505.8 | | Operating Income (Loss) | 16.4 | 8.3 | | Net Income (Loss) Attributable to Dun & Bradstreet Holdings, Inc. | (31.3) | (25.0) | | Adjusted EBITDA | 190.1 | 185.6 | | Adjusted EBITDA Margin | 35.5% | 36.5% | | Adjusted Net Income | 102.5 | 97.8 | | Adjusted EPS | 0.24 | 0.23 | - Total revenue increased by 6.2% year-over-year to $536.0 million, with Adjusted Revenue growing 5.3% and Organic Revenue (excluding acquisition/divestiture impacts and foreign currency changes) growing 4.5%[199] - GAAP net loss expanded to $31.3 million, primarily due to a $16.3 million debt early redemption premium, partially offset by improved operating income[228] - Adjusted EBITDA increased by 2.4% to $190.1 million, but Adjusted EBITDA margin decreased by 100 basis points to 35.5%, primarily due to revenue growth and lower personnel costs, partially offset by increased data and data processing costs[218] Liquidity and Capital Resources The company maintains liquidity primarily through cash flow from operations, cash and cash equivalents on hand, and short-term borrowings, with $215.8 million in cash and cash equivalents as of March 31, 2022, of which $206.4 million was held by foreign operations, and Q1 2022 saw $138.8 million net cash from operating activities, $49.4 million cash outflow from investing activities, and $51.0 million cash outflow from financing activities, with total debt at $3,721.4 million, and operations expected to continue generating substantial cash - The company's primary sources of liquidity include cash flow from operating activities, cash and cash equivalents on hand, and short-term borrowings under its senior secured credit facilities[230] - As of March 31, 2022, cash and cash equivalents totaled $215.8 million, with $206.4 million held by foreign operations[232] Cash Flow Summary | Cash Flow Type (million USD) | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--------------------------- | :-------------------------------- | :-------------------------------- | | Net Cash from Operating Activities | 138.8 | 168.2 | | Net Cash from Investing Activities | (49.4) | (637.9) | | Net Cash from Financing Activities | (51.0) | 290.1 | - Operating cash flow decreased primarily due to higher net tax payments of $88.0 million in Q1 2022, compared to a $66.2 million cash benefit from the CARES Act in Q1 2021[235] - Investing cash outflows decreased significantly due to the absence of major acquisitions in Q1 2022, compared to the Bisnode acquisition in Q1 2021[236] - Financing cash outflows increased primarily due to $436.3 million in debt redemption payments in Q1 2022, partially offset by proceeds from an incremental term loan[238] Item 3. Quantitative and Qualitative Disclosures about Market Risk The company's market risks primarily include the impact of foreign currency fluctuations on assets and liabilities, changes in the market value of certain investments, and the effect of interest rate changes on borrowing costs and fair value calculations, with no material changes in market risk as of March 31, 2022, compared to the 2021 annual report - The company's market risks primarily include foreign currency fluctuations, changes in investment market values, and interest rate changes[243] - As of March 31, 2022, there were no material changes in market risk compared to the 2021 annual report[243] Item 4. Controls and Procedures As of March 31, 2022, the company's CEO and CFO concluded that disclosure controls and procedures were effective, providing reasonable assurance that required information is timely recorded, processed, summarized, and reported, with no material changes in internal control over financial reporting identified during the quarter - As of March 31, 2022, the company's CEO and CFO concluded that disclosure controls and procedures were effective, providing reasonable assurance that required information is timely recorded, processed, summarized, and reported[248] - No material changes in internal control over financial reporting were identified during the quarter[249] PART II. OTHER INFORMATION Item 1. Legal Proceedings This chapter refers to the disclosures regarding legal proceedings, including the Federal Trade Commission investigation and two class action lawsuits, as detailed in Note 7 'Contingencies' within Part I Financial Information - Legal proceedings information is detailed in Note 7 'Contingencies' within Part I Financial Information[250] Item 1A. Risk Factors In addition to the risk factors disclosed in the 2021 annual report, new risk factors related to the Russia-Ukraine conflict were added this quarter, increasing economic uncertainty and potentially having a significant negative impact on the global macroeconomic and financial markets, despite the company having no significant operations or customers in the region - New risk factors this quarter include the company's exposure as a global enterprise to geopolitical conflicts and events, such as the Russia-Ukraine conflict, which could lead to increased economic uncertainty and significant adverse impacts on macroeconomic and financial markets[251][252] - The company has no operations or significant customer base in Russia and Ukraine, with its exposure primarily limited to immaterial Worldwide Network Alliance relationships in the region[252] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds There were no unregistered sales of equity securities or use of proceeds during the quarter - There were no unregistered sales of equity securities or use of proceeds during the quarter[253] Item 3. Defaults Upon Senior Securities There were no defaults upon senior securities during the quarter - There were no defaults upon senior securities during the quarter[253] Item 4. Mine Safety Disclosures Not applicable - Not applicable[253] Item 5. Other Information No other information was disclosed this quarter - No other information was disclosed this quarter[253] Item 6. Exhibits This chapter lists the exhibits filed with this quarterly report, including credit agreement amendments, executive employment agreements, CEO and CFO certifications under Sarbanes-Oxley Sections 302 and 906, and financial statements and cover interactive data files submitted in iXBRL format - Exhibits include credit agreement amendments, executive employment agreements, and CEO and CFO certifications under Sarbanes-Oxley Sections 302 and 906[255] - Financial statements and cover interactive data files are submitted in Inline Extensible Business Reporting Language (iXBRL) format[255]