Earnings Presentation First Quarter 2024 May 8, 2024 Forward-Looking Statements Non-GAAP Measures & Other Performance Metrics Thispresentationmaycontain“forward-lookingstatements”withinthemeaningoftheU.S.PrivateSecurities To supplement the financial measures presented in our presentation and related conference call in accordance LitigationReformActof1995.Inthiscontext,forward-lookingstatementsgenerallyrelatetofutureeventsor withgenerallyacceptedaccountingprinciplesintheUnitedStates(“GAAP”),wealsopresentthef ...

Advantage Solutions Inc. (NASDAQ:ADV) Q1 2024 Earnings Conference Call May 9, 2024 8:30 AM ET Company Participants Ruben Mella - Vice President, Investment Relations Dave Peacock - Chief Executive Officer Chris Growe - Chief Financial Officer Sean Choksi - Senior Vice President, Strategy and M&A Conference Call Participants Pallav Saini - Canaccord Genuity Faiza Alwy - Deutsche Bank Operator Greetings. And welcome to the Advantage Solutions First Quarter 2024 Earnings Call. At this time, all participants ar ...

PART I—FINANCIAL INFORMATION [Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) Advantage Solutions reported a Q1 2024 revenue decrease and net loss, significantly improved by a gain from discontinued operations [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $3.63 billion and total liabilities to $2.55 billion as of March 31, 2024, primarily due to debt reduction Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $112,293 | $120,839 | | Total current assets | $932,128 | $1,012,034 | | Goodwill | $833,491 | $833,491 | | Total assets | $3,634,072 | $3,779,323 | | Total current liabilities | $476,928 | $541,297 | | Long-term debt, net of current portion | $1,795,878 | $1,848,118 | | Total liabilities | $2,549,889 | $2,675,246 | | Total stockholders' equity | $1,084,183 | $1,104,077 | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Q1 2024 revenues decreased to $879.0 million, leading to an operating loss, but a significant gain from discontinued operations reduced the net loss Q1 2024 vs Q1 2023 Performance (in thousands, except per share data) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Revenues | $879,003 | $944,382 | | Operating (loss) income from continuing operations | $(26,762) | $6,744 | | Net loss from continuing operations | $(49,107) | $(34,370) | | Net income (loss) from discontinued operations | $45,992 | $(13,308) | | **Net loss** | **$(3,115)** | **$(47,678)** | | Basic net loss per common share | $(0.02) | $(0.15) | [Condensed Consolidated Statements of Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) Total stockholders' equity decreased to $1.084 billion due to a net loss of $3.1 million and $11.7 million in treasury stock purchases - Key drivers for the change in equity during Q1 2024 included a net loss of **$3.1 million** and the repurchase of treasury stock for **$11.7 million**[10](index=10&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2024 operating activities used cash, while divestitures provided $87.4 million, and financing used cash for debt and share repurchases Cash Flow Summary from Continuing Operations (in thousands) | Activity | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(8,894) | $41,396 | | Net cash provided by (used in) investing activities | $68,715 | $(5,988) | | Net cash used in financing activities | $(66,882) | $(6,797) | - Investing activities were significantly impacted by **$87.4 million** in proceeds from divestitures in Q1 2024[12](index=12&type=chunk) - Financing activities in Q1 2024 included **$47.9 million** for repurchases of Senior Secured Notes and **$11.7 million** for the purchase of treasury stock[12](index=12&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) Notes detail segment reorganization, a $91.0 million divestiture, debt repurchase, goodwill impairment risks, and April 2024 equity grants - Effective January 1, 2024, the company revised its reportable segments to **Branded Services**, **Experiential Services**, and **Retailer Services** to align with its business strategy[18](index=18&type=chunk)[68](index=68&type=chunk) - In January 2024, the company sold its foodservice businesses for approximately **$91.0 million**, recognizing a gain of **$56.6 million** These and other divested businesses are now presented as discontinued operations[34](index=34&type=chunk)[36](index=36&type=chunk) - The company voluntarily repurchased **$51.0 million** of its Senior Secured Notes during Q1 2024, recognizing a gain of **$2.7 million**[50](index=50&type=chunk) - Goodwill impairment tests as of January 1, 2024, indicated that the fair values of the Branded Agencies and Experiential Services reporting units exceeded their carrying values by **less than 20%**[20](index=20&type=chunk) - In April 2024, the company granted **5.3 million RSUs**, **1.1 million PSUs**, and **3.0 million stock options**[91](index=91&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=33&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the 6.9% revenue decline to a European joint venture deconsolidation, with organic revenue growth of 3.0% and a widened operating loss [Executive Overview](index=33&type=section&id=Executive%20Overview) The company reorganized into three new segments, divesting non-core units to simplify its portfolio and focus on core services - Effective January 1, 2024, the company realigned into three reportable segments: **Branded Services**, **Experiential Services**, and **Retailer Services**[96](index=96&type=chunk) - The company has formally disposed of certain business units as part of a reorganization plan, with these units now classified as discontinued operations[97](index=97&type=chunk) [Results of Operations](index=40&type=section&id=Results%20of%20Operations) Q1 2024 revenues decreased 6.9% to $879.0 million due to a European joint venture deconsolidation, with an increased operating loss from reorganization costs Revenue by Segment (in thousands) | Segment | Q1 2024 | Q1 2023 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Branded Services | $344,529 | $444,862 | $(100,333) | (22.6%) | | Experiential Services | $307,351 | $257,167 | $50,184 | 19.5% | | Retailer Services | $227,123 | $242,353 | $(15,230) | (6.3%) | | **Total Revenues** | **$879,003** | **$944,382** | **$(65,379)** | **(6.9%)** | - Excluding the impact of the European joint venture deconsolidation and foreign exchange rates, total revenues increased by **3.0%**[132](index=132&type=chunk) - The increase in operating loss was primarily due to a **$26.0 million** increase in costs associated with internal reorganization activities, largely related to professional fees and severance[136](index=136&type=chunk)[144](index=144&type=chunk) - Net income from discontinued operations of **$46.0 million** was primarily driven by a **$56.7 million** gain on the divestiture of the foodservice businesses[145](index=145&type=chunk) [Non-GAAP Financial Measures](index=46&type=section&id=Non-GAAP%20Financial%20Measures) Adjusted Net Income slightly increased to $14.9 million, but Adjusted EBITDA decreased 14.5% to $78.8 million due to lower revenues and wage inflation Adjusted EBITDA by Segment (in thousands) | Segment | Q1 2024 | Q1 2023 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Branded Services | $41,400 | $61,193 | $(19,793) | (32.3%) | | Experiential Services | $17,125 | $6,862 | $10,263 | 149.6% | | Retailer Services | $20,235 | $24,015 | $(3,780) | (15.7%) | | **Total Adjusted EBITDA** | **$78,760** | **$92,070** | **$(13,310)** | **(14.5%)** | Reconciliation of Net Loss to Adjusted Net Income (in thousands) | Line Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net loss | $(3,115) | $(47,678) | | Adjustments (Amortization, Reorganization, etc.) | $18,027 | $61,451 | | **Adjusted Net Income** | **$14,912** | **$13,773** | [Liquidity and Capital Resources](index=53&type=section&id=Liquidity%20and%20Capital%20Resources) Q1 2024 operating activities used cash, while divestitures provided $87.4 million, and financing used cash for debt and share repurchases - Principal uses of cash in Q1 2024 included repurchases of Senior Secured Notes (**$47.9 million**), share repurchases (**$11.7 million**), and principal payments on the Term Loan Facility (**$3.3 million**)[171](index=171&type=chunk) - As of March 31, 2024, the company had **$1.1 billion** outstanding under its Term Loan Facility and **$692.0 million** under its Senior Secured Notes[48](index=48&type=chunk) - The company has access to a **$500.0 million** Revolving Credit Facility, with full capacity available as of March 31, 2024, subject to borrowing base limitations and outstanding letters of credit[174](index=174&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=44&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from foreign currency and interest rate fluctuations, mitigated by derivative instruments, with minimal impact from hypothetical changes - The company's main foreign currency exposure is to the **Canadian dollar**[205](index=205&type=chunk) - Interest rate risk pertains to the Term Loan Facility and Revolving Credit Facility The company uses interest rate cap and collar agreements to manage this exposure[207](index=207&type=chunk) - As of March 31, 2024, the company had interest rate cap and collar contracts with an aggregate notional value of **$950.0 million**[57](index=57&type=chunk) [Controls and Procedures](index=44&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of March 31, 2024, with no material changes to internal control over financial reporting - The CEO and CFO concluded that as of March 31, 2024, the company's disclosure controls and procedures were **effective**[210](index=210&type=chunk) - No changes in internal control over financial reporting occurred during the quarter ended March 31, 2024, that have **materially affected**, or are reasonably likely to materially affect, the company's internal control[211](index=211&type=chunk) PART II—OTHER INFORMATION [Legal Proceedings](index=46&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal matters, including class actions and the 'Take 5 Matter' related to misconduct, with indeterminable potential liability - The company is involved in various litigation, including **class actions** related to California labor laws and commercial disputes[214](index=214&type=chunk)[216](index=216&type=chunk) - A key legal issue is the '**Take 5 Matter**,' which involves misconduct at a previously acquired business (Take 5 Media Group), a subsequent government investigation, and potential liability for which the amount is currently **indeterminable**[217](index=217&type=chunk) [Risk Factors](index=46&type=page&id=Item%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the 2023 Annual Report on Form 10-K were reported - **No material changes** to the risk factors disclosed in the 2023 Annual Report on Form 10-K were reported[218](index=218&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=46&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities or use of proceeds were reported during the period - **None**[218](index=218&type=chunk) [Defaults Upon Senior Securities](index=47&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities were reported - **None**[219](index=219&type=chunk) [Mine Safety Disclosures](index=47&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - **Not applicable**[219](index=219&type=chunk) [Other Information](index=47&type=section&id=Item%205.%20Other%20Information) No directors or executive officers adopted or terminated a Rule 10b5-1 trading arrangement in Q1 2024 - **No directors or executive officers adopted or terminated** a Rule 10b5-1 trading arrangement in Q1 2024[220](index=220&type=chunk) [Exhibits](index=47&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including an amendment to the First Lien Credit Agreement and CEO/CFO certifications - Filed exhibits include **Amendment No. 3 to the First Lien Credit Agreement** and required **CEO/CFO certifications**[221](index=221&type=chunk)

Advantage Solutions Reports First Quarter Results with New Reporting Segments and Reaffirms its 2024 Outlook • Management reaffirms its 2024 outlook as first-quarter results met expectations despite soft market conditions and higher-than-expected costs and investments. • Inclusive of discontinued operations, revenues were $906 million, a 10% decline compared to the prior year and an increase of 1% when excluding the impact of divestitures, foreign exchange, and pass-through costs. Operating income was $31.3 ...

Core Viewpoint - Advantage Solutions Inc. has sold its digital marketing agency Adlucent to BarkleyOKRP, aiming to simplify its portfolio and strengthen its financial position [1][3]. Group 1: Transaction Details - The sale of Adlucent, a performance media business acquired by Advantage in 2016, was completed without disclosing the terms [1]. - The proceeds from the sale will primarily be used to pay down debt [1]. Group 2: Strategic Rationale - The CEO of Advantage Solutions, Dave Peacock, stated that Adlucent will thrive better within a digital-focused independent agency like BarkleyOKRP, allowing Advantage to concentrate on its core growth efforts [2]. - The sale is part of a broader strategy to simplify Advantage's business model, enabling a stronger focus on core capabilities and improving the balance sheet [3]. Group 3: Business Context - Adlucent specializes in performance media activation across major paid channels, including search, social, and CTV, and has established relationships with significant platforms like Amazon, Google, Microsoft, and Meta [2]. - The sale follows a series of strategic moves by Advantage, including the divestiture of foodservice businesses and restructuring of its European joint venture [3].

Group 1 - Advantage Solutions Inc. will release its first quarter financial results on May 9, 2024, at 7 a.m. ET, followed by a conference call at 8:30 a.m. ET [1] - The conference call can be accessed via phone or through a webcast on the company's Investor Relations website [1] - A replay of the conference call will be available for a limited time after the call [1] Group 2 - Dave Peacock, CEO, and Chris Growe, CFO, will participate in the Morgan Stanley Business Services Conference on May 9, 2024 [2] - The conference will take place at the Morgan Stanley Headquarters in New York [2] Group 3 - Advantage Solutions is a leading provider of outsourced sales and marketing solutions, focusing on the intersection of brands and retailers [3] - The company offers data- and technology-driven services, including headquarter sales, retail merchandising, and omnichannel marketing [3] - Advantage Solutions operates throughout North America and has strategic investments in various global markets [3]

Group 1 - Advantage Solutions Inc. will release its first quarter financial results on May 9, 2024, at 7 a.m. ET, followed by a conference call at 8:30 a.m. ET [1] - The conference call can be accessed via phone or through a webcast on the company's Investor Relations website [1] - A replay of the conference call will be available for a limited time after the call, with specific access details provided [1] Group 2 - Dave Peacock, CEO, and Chris Growe, CFO, will participate in the Morgan Stanley Business Services Conference on May 9, 2024 [2] - The conference will take place at the Morgan Stanley Headquarters in New York [2] Group 3 - Advantage Solutions is a leading provider of outsourced sales and marketing solutions, focusing on the intersection of brands and retailers [3] - The company offers data- and technology-driven services, including headquarter sales, retail merchandising, and omnichannel marketing [3] - Advantage Solutions operates throughout North America and has strategic investments in various global markets [3]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Advantage Solutions Inc. Washington, D.C. 20549 (Exact name of registrant as specified in its charter) FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year Ended December 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-38990 (State or other jurisdiction of incorporation or organiza ...

分组1 - Advantage Solutions Inc. reported quarterly earnings of $0.06 per share, missing the Zacks Consensus Estimate of $0.14 per share, and down from $0.49 per share a year ago, representing an earnings surprise of -57.14% [1] - The company posted revenues of $1.08 billion for the quarter, missing the Zacks Consensus Estimate by 5.41%, compared to $1.1 billion in the same quarter last year [1] - Over the last four quarters, Advantage Solutions has not surpassed consensus EPS estimates, and it has topped consensus revenue estimates only twice [1] 分组2 - The stock has added about 4.4% since the beginning of the year, underperforming the S&P 500's gain of 6.3% [2] - The current consensus EPS estimate for the coming quarter is $0.07 on revenues of $922.6 million, and for the current fiscal year, it is $0.50 on revenues of $4.16 billion [4] - The Zacks Industry Rank for Business - Information Services is in the top 39% of over 250 Zacks industries, indicating a favorable outlook for the industry [5]

2023 consolidated revenues were $4.2 billion, a year-over-year increase of 4.3%, and operating income was $76.2 million. Excluding foreign exchange, acquisitions and divestitures, revenues increased 6.8%, and Adjusted EBITDA declined 1.7% to $424.3 million but finished ahead of previous guidance.Solid performance in the fourth quarter resulted in operating income of $46.2 million and a 2% year-over-year increase in Adjusted EBITDA, which increased by 4.4% excluding foreign exchange, acquisitions and divesti ...