0001682745false00016827452024-02-292024-02-29

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): February 29, 2024

 

VERRA MOBILITY CORPORATION

(Exact name of registrant as specified in its charter)

 

 

Delaware	1-37979	81-3563824
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

 

1150 N. Alma School Road Mesa, Arizona (Address of principal executive offices)	85201 (Zip Code)

(480) 443-7000

(Registrant’s telephone number, including area code)

 

N/A

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

(Title of each class)		(Trading symbol)		(Name of each exchange on which registered)
Class A common stock, par value $0.0001 per share		VRRM		Nasdaq Capital Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

☐ Emerging growth company

☐ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

 

 

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Item 2.02 Results of Operations and Financial Condition.

On February 29, 2024, Verra Mobility Corporation (the “Company”) issued a press release announcing its financial results for the quarter and fiscal year ended December 31, 2023. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
 

Item 7.01 Regulation FD Disclosure.

The Company will host a conference call and live webcast to discuss its fourth quarter and full year 2023 financial results on February 29, 2024, at 5:00 p.m. Eastern time. Live and archived webcasts of the presentation will also be available on the Company’s investor relations website at ir.verramobility.com, although the Company reserves the right to discontinue that availability at any time.

On February 29, 2024, the Company posted supplemental investor materials on its investor relations website. The Company uses its investor relations website as a means of disclosing material non-public information, announcing upcoming investor conferences and for complying with its disclosure obligations under Regulation FD. Accordingly, investors should monitor the Company’s investor relations website in addition to following its press releases, SEC filings and public conference calls and webcasts.

The information being furnished pursuant to Item 2.02, including Exhibit 99.1, and Item 7.01 of this Current Report on Form 8-K shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, and shall not be incorporated by reference into any other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit Number		Description of Exhibits
99.1		Press Release, dated February 29, 2024, issued by Verra Mobility Corporation.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Dated: February 29, 2024	Verra Mobility Corporation
	By:	/s/ Craig Conti
	Name:	Craig Conti
	Title:	Chief Financial Officer

 

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Exhibit 99.1

 

 

Verra Mobility Announces Fourth Quarter and Full Year 2023 Financial Results

 

 

MESA, Ariz., February 29, 2024 /PRNewswire/ – Verra Mobility Corporation (NASDAQ: VRRM), a leading provider of smart mobility technology solutions, announced today the financial results for the fourth quarter and full year ended December 31, 2023.

 

“We delivered fantastic results for the fourth quarter, highlighted by robust revenue and Adjusted EBITDA performance,” said David Roberts, President and CEO, Verra Mobility. “Our strong results are aligned with three macro trends across our operating segments: First, we’re seeing strong travel demand by both consumers and businesses, particularly in the United States. The second macro trend is the continued push for safer roads and communities, which drives demand for investments in automated safety enforcement. And lastly, the complexities surrounding university and municipality parking create opportunities that we address and solve through our software-enabled parking management solutions.”

Fourth Quarter 2023 Financial Highlights

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We report our results of operations based on three operating segments:

Fourth Quarter 2023 Segment Detail

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Full Year 2023 Financial Highlights

Liquidity: As of December 31, 2023, cash and cash equivalents were $136.3 million, and we generated $206.1 million in cash flows from operations for the fiscal year ended December 31, 2023.

Interest Rate Swap

In December 2022, we entered into a cancellable interest rate swap agreement to hedge our exposure to interest rate fluctuations associated with the LIBOR (now transitioned to Term Secured Overnight Financing Rate) portion of the variable interest rate on our 2021 Term Loan. Under the interest rate swap agreement, we pay a fixed rate of 5.17% and the counterparty pays a variable interest rate which is net settled. The notional amount on the interest rate swap is $675.0 million. We have the monthly option to terminate the interest rate swap agreement until December 2025 in the event interest rates decrease. Any changes in the fair value of the derivative instrument (including accrued interest) and related cash payments are recorded in the condensed consolidated statements of operations within the loss (gain) on interest rate swap line item. We recorded a $2.8 million loss during the three months ended December 31, 2023, of which approximately $3.0 million is associated with the derivative instrument re-measured to fair value at the end of the reporting period, netted by $0.2 million related to the net cash received. We recorded a $0.8 million loss during fiscal year 2023, of which approximately $(0.3) million is associated with the derivative instrument re-measured to fair value at the end of the reporting period, netted by $1.1 million related to the monthly cash payments. We recorded a gain of $1.0 million during fiscal year 2022 associated with the derivative instrument re-measured to fair value.

Warrants

During fiscal year 2023, we processed the exercise of approximately 20 million warrants in exchange for the issuance of 16,273,406 shares of Class A Common Stock. There were 14,035,449 shares issued on a cash-basis resulting in the receipt of $161.4 million in cash proceeds during fiscal year 2023.

Share Repurchases

In November 2022, our Board of Directors authorized a share repurchase program for up to an aggregate amount of $100.0 million of our outstanding shares of Class A Common Stock over an 18-month period in open market, accelerated share repurchase (“ASR”) or privately negotiated transactions, each as permitted under applicable rules and regulations, any of which may use pre-arranged trading plans that are designed to meet the requirements of Rule 10b5-1 of the Securities Exchange Act of 1934, as amended ( the "Exchange Act").

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We paid $8.1 million to repurchase 449,432 shares of our Class A Common Stock through open market transactions during the third quarter of fiscal year 2023, which we subsequently retired. On September 5, 2023, we used the remaining availability under the share repurchase program for an ASR and paid approximately $91.9 million to receive an initial delivery of 4,131,551 shares of our Class A Common Stock in accordance with an ASR agreement with a third-party financial institution. The final settlement occurred on January 12, 2024, at which time, we received 534,499 additional shares calculated using a volume-weighted average price over the term of the ASR agreement. We paid a total of $100.0 million for shares repurchases during the year ended December 31, 2023.

New Share Repurchase Program

In October 2023, our Board of Directors approved a stock repurchase program, which authorizes us to repurchase up to $100.0 million of our Class A Common Stock over an 18-month period from time to time in open market transactions, ASR or in privately negotiated transactions, each as permitted under applicable rules and regulations. Repurchases may be conducted and may be suspended or terminated at any time without notice. The extent to which we repurchase shares of our Class A Common Stock and the timing of such purchases will depend upon market conditions, our capital position, and other considerations as may be considered by us. Repurchases may also be made pursuant to a trading plan under Rule 10b5-1 under the Exchange Act, which would permit shares to be repurchased when we might otherwise be precluded from doing so because of self-imposed trading blackout periods or other regulatory restrictions. The timing and actual number of shares repurchased will depend on a variety of factors, including price, general business and market conditions, and alternative investment opportunities. The repurchase program will be executed consistent with our capital allocation strategy, which will continue to prioritize investments to grow the business.

Legal Proceedings

On November 2, 2020, PlusPass, Inc. (“PlusPass”) commenced an action in the United States District Court, Central District of California, against Verra Mobility, The Gores Group LLC, Platinum Equity LLC, and ATS Processing Services, Inc., alleging civil violations of Section 7 of the Clayton Antitrust Act of 1914 and Sections 1 and 2 of the Sherman Act. In February 2024, we entered into a confidential business arrangement to acquire certain assets from PlusPass and fully and finally resolve all litigation and disputes between the parties. We accrued $31.5 million for this matter at December 31, 2023, which is presented within selling, general and administrative expenses in the condensed consolidated statements of operations for the year ended December 31, 2023.

2024 Full Year Guidance

Any guidance that we provide is subject to change as a variety of factors can affect actual operating results. Certain of the factors that may impact our actual operating results are identified below in the safe harbor language included within Forward-Looking Statements of this press release.

We are providing the following forward-looking guidance, which includes Adjusted EBITDA, Adjusted EPS, and Adjusted Free Cash Flow, all of which are non-GAAP financial measures (defined below):

Conference Call Details

Date: February 29, 2024

Time: 5:00 p.m. Eastern Time

U.S. and Canadian Callers Dial-in: 1-888-886-7786

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Outside of U.S. and Canada Dial-in: 1-416-764-8658 for international callers with conference ID 36121812

Request a return call: Available by clicking on the following link and requesting a return call: callme.viavid.com

Webcast Information: Available live in the “Investor Relations” section of our website at http://ir.verramobility.com.

An audio replay of the call will also be available until 11:59 p.m. ET on March 14, 2024, by dialing 1-844-512-2921 for the U.S. or Canada, and 1-412-317-6671 for international callers and entering passcode 36121812. In addition, an archived webcast will be available in the “News & Events” section of the Investor Relations website at http://ir.verramobility.com.

 

About Verra Mobility

 

Verra Mobility is a leading provider of smart mobility technology solutions that make transportation safer, smarter and more connected. We sit at the center of the mobility ecosystem, bringing together vehicles, hardware, software, data and people to enable safe, efficient solutions for customers globally. Our transportation safety systems and parking management solutions protect lives, improve urban and motorway mobility and support healthier communities. We also solve complex payment, utilization and compliance challenges for fleet owners and rental car companies. We are headquartered in Arizona, and operate in North America, Europe, Asia and Australia. For more information, please visit www.verramobility.com.

Forward-Looking Statements

This press release contains forward-looking statements which address our expected future business and financial performance, and may contain words such as “goal,” “target,” “future,” “estimate,” “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “project,” “may,” “should,” “will” or similar expressions. Examples of forward-looking statements include, among others, statements regarding the changes and trends in the market for our products and services, expected operating results, such as revenue growth, expansion plans and opportunities, and earnings guidance related to 2024 financial and operational metrics. Forward-looking statements involve risks and uncertainties and a number of factors could cause actual results to differ materially from those currently anticipated. These factors include, but are not limited to, economic and geopolitical conditions; customer concentration, demand and spending; new and emerging technologies; cybersecurity risks; our ability to manage our substantial level of indebtedness; risks and uncertainties related to our government contracts, including legislative changes, termination rights, delays in payments, audits and investigations; legislative changes; our reliance on a limited number of third-party vendors and service providers; and other risks and uncertainties indicated from time to time in documents we filed or will file with the Securities and Exchange Commission (the “SEC”). In addition, no assurance can be given that any plan, initiative, projection, goal, commitment, expectation, or prospect set forth in this release can or will be achieved. This press release should be read in conjunction with the information included in our other press releases, reports and other filings with the SEC. Understanding the information contained in these filings is important in order to fully understand our reported financial results and our business outlook for future periods.

Additional Information

We periodically provide information for investors on our corporate website, www.verramobility.com, and our investor relations website, ir.verramobility.com.

We intend to use our website as a means of disclosing material non-public information and for complying with disclosure obligations under Regulation FD. Accordingly, investors should monitor our website, in addition to following our press releases, SEC filings and public conference calls and webcasts.

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Non-GAAP Financial Measures

In addition to disclosing financial results that are determined in accordance with U.S. generally accepted accounting principles (“GAAP”), we also disclose certain non-GAAP financial information in this press release. These financial measures are not recognized measures under GAAP and are not intended to be, and should not be, considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. EBITDA, Adjusted EBITDA, Free Cash Flow, Adjusted Free Cash Flow, Adjusted Net Income, Adjusted EPS and Adjusted EBITDA Margin are non-GAAP financial measures as defined by SEC rules. These non-GAAP financial measures may be determined or calculated differently by other companies. As a result, they may not be comparable to similarly titled performance measures presented by other companies. Reconciliations of these non-GAAP measurements to the most directly comparable GAAP financial measurements have been provided in the financial statement tables included in this press release, and investors are encouraged to review the reconciliations.

We are not providing a quantitative reconciliation of Adjusted EBITDA, Adjusted EPS, or Adjusted Free Cash Flow which are included in our 2024 financial guidance above, in reliance on the “unreasonable efforts” exception for forward-looking non-GAAP measures set forth in SEC rules because certain financial information, the probable significance of which cannot be determined, is not available and cannot be reasonably estimated without unreasonable effort and expense. In this regard, we are unable to provide a reconciliation of forward-looking Adjusted EBITDA to GAAP net income as well as Adjusted EPS to net income per share, due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation. Due to the uncertainty of estimates and assumptions used in preparing forward-looking non-GAAP measures, we caution investors that actual results could differ materially from these non-GAAP financial projections.

We use these non-GAAP financial metrics to measure our performance from period to period both at the consolidated level as well as within our operating segments, to evaluate and fund incentive compensation programs and to compare our results to those of our competitors. In addition, we also believe that these non-GAAP measures provide useful information to investors regarding financial and business trends related to our results of operations and that when non-GAAP financial information is viewed with GAAP financial information, investors are provided with a more meaningful understanding of our ongoing operating performance. These non-GAAP measures have certain limitations as analytical tools and should not be used as substitutes for net income, cash flows from operations, earnings per share or other consolidated income or cash flow data prepared in accordance with GAAP.

 

EBITDA and Adjusted EBITDA

We define EBITDA as net income adjusted to exclude interest expense, net, income taxes, depreciation and amortization. Adjusted EBITDA further excludes certain non-cash expenses and other transactions that management believes are not indicative of our ongoing operating performance. EBITDA and Adjusted EBITDA, as defined, exclude some but not all items that affect our cash flow from operating activities.

 

Free Cash Flow

We define “Free Cash Flow” as cash flow from operations less capital expenditures.

Adjusted Free Cash Flow

We define Adjusted Free Cash Flow as Free Cash Flow which further excludes certain one-time and non-recurring items (for example, the PlusPass legal settlement).

 

Adjusted Net Income

We define “Adjusted Net Income” as net income adjusted to exclude amortization of intangibles and certain non-cash or non-recurring expenses.

 

 

 

 

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Adjusted EPS

We define “Adjusted EPS” as Adjusted Net Income divided by the diluted weighted average shares for the period.

 

Adjusted EBITDA Margin

We define “Adjusted EBITDA Margin” as Adjusted EBITDA as a percentage of total revenue.

 

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VERRA MOBILITY CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

(In thousands, except per share data)			December 31, 2023				December 31, 2022
Assets
Current assets:
Cash and cash equivalents			$	136,309			$	105,204
Restricted cash				3,413				3,911
Accounts receivable (net of allowance for credit losses of $18.5 million and $15.9 million at December 31, 2023 and 2022, respectively)				197,824				163,786
Unbilled receivables				37,065				30,782
Inventory				17,966				19,307
Prepaid expenses and other current assets				46,961				39,604
Total current assets				439,538				362,594
Installation and service parts, net				22,895				22,923
Property and equipment, net				123,248				109,775
Operating lease assets				33,523				37,593
Intangible assets, net				301,025				377,420
Goodwill				835,835				833,480
Other non-current assets				33,919				12,484
Total assets			$	1,789,983			$	1,756,269
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable			$	78,749			$	79,869
Deferred revenue				28,788				31,164
Accrued liabilities				93,119				48,847
Tax receivable agreement liability, current portion				5,098				4,994
Current portion of long-term debt				9,019				21,935
Total current liabilities				214,773				186,809
Long-term debt, net of current portion				1,029,113				1,190,045
Operating lease liabilities, net of current portion				29,124				33,362
Tax receivable agreement liability, net of current portion				48,369				50,900
Private placement warrant liabilities				—				24,066
Asset retirement obligations				14,580				12,993
Deferred tax liabilities, net				18,360				21,149
Other long-term liabilities				14,197				5,875
Total liabilities				1,368,516				1,525,199
Commitments and contingencies
Stockholders' equity
Preferred stock, $0.0001 par value				—				—
Common stock, $0.0001 par value				17				15
Common stock contingent consideration				—				36,575
Additional paid-in capital				557,513				305,423
Accumulated deficit				(125,887	)			(98,078	)
Accumulated other comprehensive loss				(10,176	)			(12,865	)
Total stockholders' equity				421,467				231,070
Total liabilities and stockholders' equity			$	1,789,983			$	1,756,269

 

 

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VERRA MOBILITY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME

(Unaudited)

 

		Three Months Ended December 31,								Year Ended December 31,
(In thousands, except per share data)		2023				2022				2023				2022
Service revenue		$	201,818			$	178,965			$	783,595			$	695,218
Product sales			9,195				7,105				33,715				46,380
Total revenue			211,013				186,070				817,310				741,598
Cost of service revenue, excluding depreciation and amortization			4,514				4,694				18,232				16,330
Cost of product sales			7,022				5,294				25,231				30,932
Operating expenses			76,915				59,529				273,288				226,324
Selling, general and administrative expenses			73,056				40,220				198,550				163,133
Depreciation, amortization and (gain) loss on disposal of assets, net			26,177				34,293				113,195				140,174
Total costs and expenses			187,684				144,030				628,496				576,893
Income from operations			23,329				42,040				188,814				164,705
Interest expense, net			20,859				20,348				86,701				69,372
Change in fair value of private placement warrants			—				(9,267	)			24,966				(14,400	)
Tax receivable agreement liability adjustment			(3,077	)			245				(3,077	)			(720	)
Loss (gain) on interest rate swap			2,764				(996	)			817				(996	)
Loss (gain) on extinguishment of debt			—				—				3,533				(3,005	)
Other income, net			1,643				(3,287	)			(11,123	)			(12,654	)
Total other expenses			22,189				7,043				101,817				37,597
Income before income taxes			1,140				34,997				86,997				127,108
Income tax (benefit) provision			(1,882	)			6,779				29,982				34,633
Net income		$	3,022			$	28,218			$	57,015			$	92,475
Other comprehensive income (loss):
Change in foreign currency translation adjustment			6,250				8,069				2,689				(7,771	)
Total comprehensive income		$	9,272			$	36,287			$	59,704			$	84,704
Net income per share:
Basic		$	0.02			$	0.19			$	0.36			$	0.61
Diluted		$	0.02			$	0.13			$	0.36			$	0.50
Weighted average shares outstanding:
Basic			166,437				149,227				158,777				152,848
Diluted			168,585				154,825				160,017				159,026

 

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VERRA MOBILITY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

		Three Months Ended December 31,
($ in thousands)		2023				2022
Cash Flows from Operating Activities:
Net income		$	3,022			$	28,218
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			26,232				33,390
Amortization of deferred financing costs and discounts			1,079				1,350
Change in fair value of private placement warrants			—				(9,267	)
Tax receivable agreement liability adjustment			(3,077	)			245
Loss (gain) on interest rate swap			3,041				(996	)
Credit loss expense			1,501				3,589
Deferred income taxes			(19,801	)			(45	)
Stock-based compensation			5,130				3,007
Impairment of long-lived assets and ROU assets			4,280				—
Impairment on a privately-held equity investment			—				1,340
Other			53				1,030
Changes in operating assets and liabilities:
Accounts receivable			(6,605	)			8,161
Unbilled receivables			3,277				2,269
Inventory			2,209				(1,254	)
Prepaid expenses and other assets			(5,109	)			(4,099	)
Deferred revenue			(5,875	)			(1,700	)
Accounts payable and other current liabilities			23,453				8,491
Other liabilities			2,920				(4,168	)
Net cash provided by operating activities			35,730				69,561
Cash Flows from Investing Activities:
Payments for interest rate swap			277				—
Purchase of intellectual property			(500	)			—
Purchases of installation and service parts and property and equipment			(16,484	)			(12,259	)
Cash proceeds from the sale of assets			110				101
Net cash used in investing activities			(16,597	)			(12,158	)
Cash Flows from Financing Activities:
Repayment of long-term debt			(2,255	)			(2,255	)
Payment of debt issuance costs			(97	)			(37	)
Proceeds from exercise of stock options			3,074				337
Payment of employee tax withholding related to RSUs and PSUs vesting			(65	)			(3,452	)
Net cash provided by (used in) financing activities			657				(5,407	)
Effect of exchange rate changes on cash and cash equivalents			1,602				1,490
Net increase in cash, cash equivalents and restricted cash			21,392				53,486
Cash, cash equivalents and restricted cash - beginning of period			118,330				55,629
Cash, cash equivalents and restricted cash - end of period		$	139,722			$	109,115

 

 

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VERRA MOBILITY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

		For the Year Ended December 31,
($ in thousands)		2023				2022
Cash Flows from Operating Activities:
Net income		$	57,015			$	92,475
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			113,067				138,684
Amortization of deferred financing costs and discounts			4,679				5,472
Change in fair value of private placement warrants			24,966				(14,400	)
Tax receivable agreement liability adjustment			(3,077	)			(720	)
Gain on interest rate swap			(320	)			(996	)
Loss (gain) on extinguishment of debt			3,533				(3,005	)
Credit loss expense			9,054				14,481
Deferred income taxes			(27,037	)			(17,355	)
Stock-based compensation			17,476				16,663
Impairment of long-lived assets and ROU assets			4,280				—
Impairment on a privately-held equity investment			—				1,340
Other			359				1,654
Changes in operating assets and liabilities:
Accounts receivable			(42,459	)			(17,685	)
Unbilled receivables			(6,252	)			(1,936	)
Inventory			1,148				(10,310	)
Prepaid expenses and other assets			(2,161	)			4,306
Deferred revenue			(2,400	)			4,591
Accounts payable and other current liabilities			50,512				6,513
Other liabilities			3,718				(1,435	)
Net cash provided by operating activities			206,101				218,337
Cash Flows from Investing Activities:
Payment of contingent consideration			—				(647	)
Payments for interest rate swap			(1,137	)			—
Purchase of intellectual property			(500	)			—
Purchases of installation and service parts and property and equipment			(56,985	)			(48,186	)
Cash proceeds from the sale of assets			332				241
Net cash used in investing activities			(58,290	)			(48,592	)
Cash Flows from Financing Activities:
Repayment on revolver			—				(25,000	)
Repayment of long-term debt			(181,519	)			(9,019	)
Payment of debt issuance costs			(459	)			(447	)
Proceeds from the exercise of warrants			161,408				—
Share repurchases and retirement			(100,000	)			(125,071	)
Proceeds from exercise of stock options			5,919				1,334
Payment of employee tax withholding related to RSUs and PSUs vesting			(3,142	)			(6,524	)
Payment of contingent consideration			—				(205	)
Net cash used in financing activities			(117,793	)			(164,932	)
Effect of exchange rate changes on cash and cash equivalents			589				(130	)
Net increase in cash, cash equivalents and restricted cash			30,607				4,683
Cash, cash equivalents and restricted cash - beginning of period			109,115				104,432
Cash, cash equivalents and restricted cash - end of period		$	139,722			$	109,115

 

 

 

 

 

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VERRA MOBILITY CORPORATION

 

ADJUSTED EBITDA RECONCILIATION (Unaudited)

 

		Three Months Ended December 31,								For the Year Ended December 31,
($ in thousands)		2023				2022				2023				2022
Net income		$	3,022			$	28,218			$	57,015			$	92,475
Interest expense, net			20,859				20,348				86,701				69,372
Income tax (benefit) provision			(1,882	)			6,779				29,982				34,633
Depreciation and amortization			26,232				33,390				113,067				138,684
EBITDA			48,231				88,735				286,765				335,164
Transaction and other related expenses			145				(76	)			629				3,381
Transformation expenses			935				604				3,241				1,113
Change in fair value of private placement warrants (i)			—				(9,267	)			24,966				(14,400	)
Legal settlement (ii)			31,500				—				31,500				—
Tax settlement payment related to a prior acquisition (iii)			5,652				—				5,652				—
Tax receivable agreement liability adjustment (iv)			(3,077	)			245				(3,077	)			(720	)
Loss (gain) on interest rate swap (v)			2,764				(996	)			817				(996	)
Loss (gain) on extinguishment of debt (vi)			—				—				3,533				(3,005	)
Stock-based compensation (vii)			5,130				3,007				17,476				16,663
Impairment on privately-held equity investment			—				1,340				—				1,340
Adjusted EBITDA		$	91,280			$	83,592			$	371,502			$	338,540

 

 

 

FREE CASH FLOW (Unaudited)

 

		Three Months Ended December 31,								For the Year Ended December 31,
($ in thousands)		2023				2022				2023				2022
Net cash provided by operating activities		$	35,730			$	69,561			$	206,101			$	218,337
Purchases of installation and service parts and property and equipment			(16,484	)			(12,259	)			(56,985	)			(48,186	)
Free Cash Flow		$	19,246			$	57,302			$	149,116			$	170,151

 

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ADJUSTED EPS (Unaudited)

 

		Three Months Ended December 31,								For the Year Ended December 31,
(In thousands, except per share data)		2023				2022				2023				2022
Net income		$	3,022			$	28,218			$	57,015			$	92,475
Amortization of intangibles			16,721				25,132				77,644				106,161
Transaction and other related expenses			145				(76	)			629				3,381
Transformation expenses			935				604				3,241				1,113
Change in fair value of private placement warrants			—				(9,267	)			24,966				(14,400	)
Legal settlement			31,500				—				31,500				—
Tax settlement payment related to a prior acquisition			5,652				—				5,652				—
Tax receivable agreement liability adjustment			(3,077	)			245				(3,077	)			(720	)
Tax receivable agreement imputed interest			(3,641	)			—				(3,641	)			—
Loss (gain) on extinguishment of debt			—				—				3,533				(3,005	)
Change in fair value of interest rate swap			3,041				(996	)			(320	)			(996	)
Stock-based compensation			5,130				3,007				17,476				16,663
Impairment on privately-held equity investment			—				1,340				—				1,340
Total adjustments before income tax effect			56,406				19,989				157,603				109,537
Income tax effect on adjustments			(19,568	)			(8,855	)			(42,105	)			(40,423	)
Total adjustments after income tax effect			36,838				11,134				115,498				69,114
Adjusted Net Income		$	39,860			$	39,352			$	172,513			$	161,589
Adjusted EPS		$	0.24			$	0.25			$	1.08			$	1.02
Diluted weighted average shares outstanding			168,585				154,825				160,017				159,026

 

 

 

 

Investor Relations Contact

Mark Zindler

mark.zindler@verramobility.com

 

 

 

 

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