AvidXchange Announces First Quarter 2022 Financial Results


–First quarter 2022 revenue and adjusted EBITDA results driven by solid transaction volume growth and lower expenses

–Raising full year 2022 revenue outlook and lowering projected Adjusted EBITDA losses

CHARLOTTE, N.C., May 05, 2022 (GLOBE NEWSWIRE) — AvidXchange Holdings, Inc. (Nasdaq: AVDX), a leading provider of accounts payable (AP) automation software and payment solutions for middle market businesses and their suppliers, today announced financial results for the first quarter ended March 31, 2022.

“We are off to a strong start in the first quarter. By any key measure – total transaction growth, revenue growth and lower expenses – our first quarter results were solid, highlighting the strength of our value proposition and our strong execution. Trend-wise, this quarter also marks our third straight quarter of 20%-plus organic revenue growth as we deliver on investment milestones set against our business flywheel and simultaneously capitalize on our leadership in the mid-market B2B accounts payable and payments automation space,” said Michael Praeger, CEO & Co-Founder of AvidXchange.

First Quarter 2022 Financial Highlights:

  • Total revenue was $71.2 million, an increase of 29.0% year-over-year, compared with $55.2 million in the first quarter of 2021.
  • GAAP net loss was $(25.1) million, compared with a GAAP net loss of $(70.0) million in the first quarter of 2021.
  • Non-GAAP net loss was $(14.5) million, compared with a Non-GAAP net loss of $(15.7) million in the first quarter of 2021.
  • GAAP gross profit was $39.1 million, or 54.9% of total revenue, compared with $28.2 million, or 51.0% of revenue in the first quarter of 2021.
  • Non-GAAP gross profit was $44.4 million, or 62.3% of total revenue, compared with $32.7 million, or 59.3% of revenue in the first quarter of 2021.
  • Adjusted EBITDA was $(5.6) million compared with $(6.5) million in the first quarter of 2021.

A reconciliation of GAAP to non-GAAP financial measures has been provided in the tables following the financial statements in this press release. An explanation of these measures is also included below under the heading “Non-GAAP Measures and Other Performance Metrics”

First Quarter 2022 Key Business Metrics and Highlights:

  • Total transactions processed in the first quarter of 2022 was 16.9 million, an increase of 15.6% from 14.6 million in the first quarter of 2021.
  • Total payment volume in the first quarter of 2022 was $15.2 billion, an increase of 40.5% from $10.8 billion in the first quarter of 2021.
  • Transaction yield in the first quarter of 2022 was $4.23, an increase of 11.6% from $3.79 in the first quarter of 2021.

Full Year 2022 Financial Outlook

As of May 5, 2022, AvidXchange anticipates its revised Full Year 2022 revenue and adjusted EBITDA to be in the following ranges (in millions):                                                

    Current Previous  
    FY 2022 Guidance FY 2022 Guidance  
  Revenue $303.0 – $307.0 $296.5 – $301.5  
  Adjusted EBITDA(1) $(35.0) – $(39.0) $(42.0) – $(48.0)  

(1)  A reconciliation of adjusted EBITDA to GAAP net loss on a forward-looking basis is not available without unreasonable efforts due to the high variability, complexity and low visibility with respect to the items excluded from this non-GAAP measure.

These statements are forward-looking and actual results may differ materially. Refer to the Forward-Looking Statements safe harbor below for information on the factors that could cause our actual results to differ materially from these forward-looking statements.

Earnings Teleconference Information

AvidXchange will discuss its first quarter 2022 financial results during a teleconference today, May 5, 2022, at 6:00 PM ET. The call will be broadcast simultaneously via webcast at https://ir.avidxchange.com/. Following the completion of the call, a recorded replay of the webcast will be available on AvidXchange’s website. In addition to the conference call, supplemental information is available on the Investor Relations section of AvidXchange’s website at https://ir.avidxchange.com/.

About AvidXchange™

AvidXchange is a leading provider of accounts payable (“AP”) automation software and payment solutions for middle market businesses and their suppliers. AvidXchange’s software-as-a-service-based, end-to-end software and payment platform digitizes and automates the AP workflows for more than 8,000 businesses and it has made payments to more than 825,000 supplier customers of its buyers over the past five years. To learn more about how AvidXchange is transforming the way companies pay their bills, visit www.AvidXchange.com

Forward-Looking Statements
This press release may contain “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995.  In this context, forward-looking statements generally relate to future events or our future financial or operating performance and often contain words such as: “anticipate,”  “intend,” “plan,” “goal,” “seek,” “believe,” “project,” “estimate,” “expect,” “future,” “likely,” “may,” “should,” “will” and similar words and phrases indicating future results. The information presented in this press release related to our expectations of future performance, including guidance for our revenue and adjusted EBITDA for the full year 2022, statements related to the significance of our strong performance in the first quarter and trend related to organic revenue growth, and other statements that are not purely statements of historical fact, are forward-looking in nature.  These forward-looking statements are made on the basis of management’s current expectations, assumptions, estimates and projections and are subject to significant risks and uncertainties that could cause actual results to differ materially from those anticipated in such forward-looking statements. We therefore cannot guarantee future results, performance or achievements. 

Factors which could cause actual results or effects to differ materially from those reflected in forward-looking statements include, but are not limited to, the risk factors and other cautionary statements described, from time to time, in AvidXchange’s filings with the Securities and Exchange Commission (“SEC”), including, without limitation, AvidXchange’s Annual Report on Form 10-K and other documents filed with the SEC, which may be obtained on the investor relations section of our website (https://ir.avidxchange.com/) and on the SEC website at www.sec.gov.  Any forward-looking statements made by us in this press release are based only on information currently available to us and speak only as of the date they are made, and we assume no obligation to update any of these statements in light of new information, future events or otherwise unless required under the federal securities laws.

Non-GAAP Measures and Other Performance Metrics

To supplement the financial measures presented in our press release and related conference call in accordance with generally accepted accounting principles in the United States (“GAAP”), we also present the following non-GAAP measures of financial performance: Non-GAAP Gross Profit, Adjusted EBITDA, and Non-GAAP Net Loss.

A “non-GAAP financial measure” refers to a numerical measure of our historical or future financial performance or financial position that is included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP in our financial statements. We provide certain non-GAAP measures as additional information relating to our operating results as a complement to results provided in accordance with GAAP. The non-GAAP financial information presented herein should be considered in conjunction with, and not as a substitute for or superior to, the financial information presented in accordance with GAAP and should not be considered a measure of liquidity. There are significant limitations associated with the use of non-GAAP financial measures. Further, these measures may differ from the non-GAAP information, even where similarly titled, used by other companies and therefore should not be used to compare our performance to that of other companies.

We have presented Non-GAAP Gross Profit, Adjusted EBITDA, and Non-GAAP Net Loss in this press release. We define Non-GAAP Gross Profit as revenue less cost of revenue excluding the portion of depreciation and amortization and stock-based compensation expense allocated to cost of revenues. We define Adjusted EBITDA as our net loss before depreciation and amortization of property and equipment, amortization of software development costs, amortization of acquired intangible assets, impairment of intangible assets, interest income and expense, income tax expense, stock-based compensation expense, transaction and acquisition-related costs expensed, change in fair value of derivative instrument, non-recurring items not indicative of ongoing operations, and charitable contributions of common stock. We define Non-GAAP Net Loss as net loss before amortization of acquired intangible assets, impairment of intangible assets, stock-based compensation expense, transaction and acquisition-related costs expensed, change in fair value of derivative instrument, non-recurring items not indicative of ongoing operations, provision for income taxes and charitable contributions of common stock.

We believe the use of non-GAAP financial measures, as a supplement to GAAP measures, is useful to investors in that they eliminate items that are either not part of our core operations or do not require a cash outlay, such as stock-based compensation expense. Management uses these non-GAAP financial measures when evaluating operating performance and for internal planning and forecasting purposes. We believe that these non-GAAP financial measures help indicate underlying trends in the business, are important in comparing current results with prior period results, and are useful to investors and financial analysts in assessing operating performance.

Investor Contact:

Subhaash Kumar
Skumar1@avidxchange.com
813.760.2309

 
AvidXchange Holdings, Inc.
Unaudited Consolidated Statements of Operations
(in thousands, except share and per share data)
    Three Months Ended March 31,  
    2022     2021  
Revenues   $ 71,203     $ 55,214  
Cost of revenues (exclusive of depreciation and amortization expense)     27,807       22,540  
Operating expenses                
Sales and marketing     17,239       13,511  
Research and development     20,072       13,933  
General and administrative     18,688       14,164  
Depreciation and amortization     7,718       7,077  
Total operating expenses     63,717       48,685  
Loss from operations     (20,321 )     (16,011 )
Other income (expense)                
Interest income     220       132  
Interest expense     (4,977 )     (5,025 )
Change in fair value of derivative instrument           946  
Charge for amending financing advisory engagement letter – related party           (50,000 )
Other expenses     (4,757 )     (53,947 )
Loss before income taxes     (25,078 )     (69,958 )
Income tax expense     69       68  
Net loss   $ (25,147 )   $ (70,026 )
Accretion of convertible preferred stock           (4,602 )
Net loss attributable to common stockholders   $ (25,147 )   $ (74,628 )
Net loss per share attributable to common stockholders, basic and diluted   $ (0.13 )   $ (1.43 )
Weighted average number of common shares used to compute net loss per share
attributable to common stockholders, basic and diluted
    197,017,555       52,057,532  
AvidXchange Holdings, Inc.
Unaudited Consolidated Balance Sheets
(in thousands, except share and per share data)
 
    As of March 31,     As of December 31,  
    2022     2021  
Assets                
Current assets                
Cash and cash equivalents   $ 294,923     $ 562,817  
Restricted funds held for customers     931,975       1,242,346  
Marketable securities     228,655        
Accounts receivable, net of allowances of $2,349 and $2,283, respectively     34,213       30,965  
Supplier advances receivable, net of allowances of $1,199 and $1,105, respectively     12,783       11,520  
Prepaid expenses and other current assets     13,839       10,237  
Total current assets     1,516,388       1,857,885  
Property and equipment, net     105,643       106,227  
Operating lease right-of-use assets     5,826       3,278  
Deferred customer origination costs, net     27,503       28,276  
Goodwill     165,921       165,921  
Intangible assets, net     106,031       100,455  
Other noncurrent assets and deposits     4,297       4,261  
Total assets   $ 1,931,609     $ 2,266,303  
Liabilities and Stockholders’ Equity                
Current liabilities                
Accounts payable   $ 15,505     $ 17,142  
Accrued expenses     51,492       56,082  
Payment service obligations     931,975       1,242,346  
Deferred revenue     9,861       9,530  
Current portion of contingent consideration     688       688  
Current maturities of lease obligations under finance leases     559       670  
Current maturities of lease obligations under operating leases     1,283       1,048  
Current maturities of long-term debt     4,800       4,800  
Total current liabilities     1,016,163       1,332,306  
Long-term liabilities                
Deferred revenue, less current     19,494       20,350  
Contingent consideration, less current portion     70       70  
Obligations under finance leases, less current maturities     61,304       61,172  
Obligations under operating leases, less current maturities     5,710       3,448  
Long-term debt     121,366       119,880  
Other long-term liabilities     2,630       6,022  
Total liabilities     1,226,737       1,543,248  
Commitments and contingencies                
Stockholders’ equity                
Preferred stock, $0.001 par value; 50,000,000 shares authorized, no shares issued
and outstanding as of March 31, 2022 and December 31, 2021
           
Common stock, $0.001 par value; 1,600,000,000 shares authorized as of March 31,
2022 and December 31, 2021; 197,626,663 and 196,804,844 shares issued and
outstanding as of March 31, 2022 and December 31, 2021, respectively
    198       197  
Additional paid-in capital     1,602,372       1,594,780  
Accumulated deficit     (897,698 )     (871,922 )
Total stockholders’ equity     704,872       723,055  
Total liabilities and stockholders’ equity   $ 1,931,609     $ 2,266,303  
AvidXchange Holdings, Inc.
Unaudited Consolidated Statements of Cash Flows
(in thousands)
 
    Three Months Ended March 31,  
    2022     2021  
Cash flows from operating activities                
Net loss   $ (25,147 )   $ (70,026 )
Adjustments to reconcile net loss to net cash used by operating activities                
Depreciation and amortization expense     7,718       7,077  
Amortization of deferred financing costs     339       339  
Provision for doubtful accounts     1,073       15  
Stock-based compensation     6,791       847  
Accrued interest     599       280  
Loss on fixed asset disposal     26        
Noncash expense on contract modification – related party           50,000  
Amortization of investments held to maturity     (60 )      
Fair value adjustment to derivative instrument           (946 )
Deferred income taxes     54       54  
Changes in operating assets and liabilities                
Accounts receivable     (3,537 )     537  
Prepaid expenses and other current assets     (3,601 )     (1,884 )
Other noncurrent assets     (59 )     (2,851 )
Deferred customer origination costs     773       (366 )
Accounts payable     (872 )     (9,095 )
Deferred revenue     (525 )     449  
Accrued expenses and other liabilities     (8,835 )     5,897  
Operating lease liabilities     (51 )     (271 )
  Total adjustments     (167 )     50,082  
  Net cash used in operating activities     (25,314 )     (19,944 )
Cash flows from investing activities                
Purchase of short-term investments held to maturity     (228,595 )      
Purchases of equipment     (967 )     (52 )
Purchases of land     (767 )      
Purchases of intangible assets     (11,309 )     (3,907 )
Supplier advances, net     (2,048 )     (139 )
Net cash used in investing activities     (243,686 )     (4,098 )
Cash flows from financing activities                
Proceeds from the issuance of long-term debt     1,170       1,131  
Principal payments on finance leases     (237 )     (309 )
Proceeds from issuance of common stock     173       540  
Payment service obligations     (310,371 )     387,431  
Net cash (used in) provided by financing activities     (309,265 )     388,793  
Net (decrease) increase in cash, cash equivalents, and restricted funds held for customers     (578,265 )     364,751  
Cash, cash equivalents, and restricted funds held for customers                
Cash, cash equivalents, and restricted funds held for customers, beginning of year     1,805,163       390,078  
Cash, cash equivalents, and restricted funds held for customers, end of period   $ 1,226,898     $ 754,829  
Supplementary information of noncash investing and financing activities                
Right-of-use assets obtained in exchange for new finance lease obligations   $ 57     $ 154  
Right-of-use assets obtained in exchange for new operating lease obligations     2,831        
Property and equipment purchases in accounts payable and accrued expenses     4       9  
Interest paid on notes payable     2,612       2,571  
Interest paid on finance leases     1,421       1,836  
AvidXchange Holdings, Inc.
Unaudited Reconciliation of GAAP to Non-GAAP Measures
(in thousands)
 
    Three Months Ended March 31,  
    2022     2021  
Reconciliation from Revenue to Non-GAAP Gross Profit and Non-GAAP Gross Margin:                
Total revenues   $ 71,203     $ 55,214  
Expenses:                
Cost of revenues (exclusive of depreciation and amortization expense)     (27,807 )     (22,540 )
Depreciation and amortization expense     (4,306 )     (4,524 )
GAAP Gross profit   $ 39,090     $ 28,150  
Adjustments:                
Stock-based compensation expense     959       56  
Depreciation and amortization expense     4,306       4,524  
Non-GAAP gross profit   $ 44,355     $ 32,730  
GAAP Gross margin     54.9 %     51.0 %
Non-GAAP gross margin     62.3 %     59.3 %
                 
Reconciliation from Net Loss to Non-GAAP Net Loss:                
Net loss   $ (25,147 )   $ (70,026 )
Amortization of acquired intangible assets     3,593       2,753  
Provision for income taxes     69       68  
Stock-based compensation expense     6,791       847  
Transaction and acquisition-related costs     204       1,610  
Change in fair value of derivative instrument           (946 )
Non-recurring items not indicative of ongoing operations     8       50,025  
Total net adjustments     10,665       54,357  
Non-GAAP net loss   $ (14,482 )   $ (15,669 )
                 
Reconciliation from Net Loss to Adjusted EBITDA:                
Net loss   $ (25,147 )   $ (70,026 )
Depreciation and amortization     7,718       7,077  
Interest income     (220 )     (132 )
Interest expense     4,977       5,025  
Provision for income taxes     69       68  
Stock-based compensation expense     6,791       847  
Transaction and acquisition-related costs     204       1,610  
Change in fair value of derivative instrument           (946 )
Non-recurring items not indicative of ongoing operations     8       50,025  
Adjusted EBITDA   $ (5,600 )   $ (6,452 )

AvidXchange



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