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Skillsoft Reports Strong Financial Results for the Third Quarter of Fiscal 2022

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Raises Full Year Outlook Following Stronger than Expected Results

Extends Leadership Position with New Customer Wins and Significant Product Momentum with Percipio Bookings up 60%

BOSTON–(BUSINESS WIRE)–Skillsoft Corp. (NYSE: SKIL) (“Skillsoft” or the “Company”), a global leader in corporate digital learning, today announced its financial results for the third quarter of fiscal 2022 ended October 31, 2021. The Company delivered bookings growth in each of its business segments and grew revenue. Skillsoft raised its full year outlook for bookings and adjusted revenue and updated its outlook for adjusted EBITDA to the midpoint of the previous range.

“We delivered another strong quarter, driving bookings and adjusted revenue growth above expectations and executing on our strategic priorities,” said Jeffrey R. Tarr, Skillsoft’s Chief Executive Officer. “We grew each of our segments, won new blue-chip customers and advanced our migration to Percipio. We also signed new strategic alliances and launched new content and platform features, further increasing the value we deliver to our customers.”

Mr. Tarr added, “In our first two quarters as a public company, we recapitalized the business, assembled a world-class management team and board of directors, completed two acquisitions, and made foundational investments in content, platform and go-to-market. We continue to advance our vision of being the most highly valued provider of learning solutions and preparing the workforce of today with the skills for tomorrow.”

Updated Full Year Fiscal 2022 Outlook1

 

Updated Outlook

Previous Outlook

Bookings

$700 million to $720 million

$690 million to $710 million

Adjusted Revenue

$685 million to $700 million

$670 million to $690 million

Adjusted EBITDA

Approximately $165 million

$155 million to $175 million

Skillsoft increased its bookings and adjusted revenue outlook for full year fiscal 2022 primarily to reflect better than expected performance through the first three quarters of the year.

The adjusted EBITDA outlook at the middle of the original outlook range reflects the Company’s growth investments in content, platform, and go-to-market capabilities, contributing to the higher than expected bookings and adjusted revenue growth.

Fiscal 2022 Third Quarter Financial Highlights2

  • Grew bookings 7%, with Content up 6%, Global Knowledge up 11%, Content and Global Knowledge combined up 8% and SumTotal up 3%;
  • Delivered GAAP revenue for the reported period of $171 million and GAAP net loss of $43 million;
  • Grew adjusted revenue3 6% to $179 million with adjusted EBITDA3 of $49 million, in line with the prior year due to growth investment, synergy timing related to the delay in the closing of the Global Knowledge transaction, and higher D&O insurance costs;
  • Delivered combined Percipio and dual deployment dollar retention rate of 101%; and
  • Advanced platform migration to Percipio, with 86% of Skillsoft Content annual recurring revenue on Percipio or Percipio dual deployment, up from 81% last quarter and 68% in the prior year period.

Key Operational Metrics and Non-GAAP Financial Measures

Bookings (previously Order Intake)

The following table sets forth unaudited bookings for the three and nine months ended October 31, 2021 and 2020 as if pre-combination Skillsoft and Global Knowledge had been combined and their fiscal quarters had been aligned to end on October 31:

$000s

Three Months Ended

October 31,

Change

Nine Months Ended

October 31,

Change

 

2021

2020

$

%

2021

2020

$

%

Content and Global Knowledge

Percipio

$17,742

$11,063

$6,679

60%

$50,276

$31,645

$18,631

59%

Dual Deployment & Coaching

53,661

36,348

17,313

48%

95,357

75,757

19,600

26%

Skillport

2,270

21,883

(19,613)

-90%

24,318

53,955

(29,637)

-55%

Total Subscription

$73,672

$69,294

$4,379

6%

$169,951

$161,357

$8,594

5%

Services & One-Time Bookings

4,620

4,319

301

7%

10,908

9,330

1,578

17%

Total Content

$78,293

$73,613

$4,680

6%

$180,859

$170,687

$10,171

6%

Global Knowledge

61,690

55,419

6,271

11%

190,488

161,225

29,262

18%

Total Content & Global Knowledge

$139,983

$129,032

$10,951

8%

$371,346

$331,913

$39,434

12%

 

SumTotal

Subscription

$22,472

$21,830

$642

3%

$64,552

$68,286

($3,734)

-5%

Services & One-Time Bookings

6,423

6,262

161

3%

17,224

15,876

1,348

8%

Total SumTotal

$28,895

$28,092

$803

3%

$81,776

$84,162

($2,386)

-3%

Total

$168,878

$157,124

$11,754

7%

$453,122

$416,075

$37,048

9%

Dollar Retention Rate

The following table sets forth dollar retention rates (“DRR”) for the last twelve month (“LTM”) period ended October 31, 2021 and for the three month periods ended October 31, 2021 and 2020 as if Skillsoft and Global Knowledge had been combined and their fiscal quarters had been aligned to end on October 31:

October 31

LTM

2021

2020

 

Percipio

100%

107%

100%

Dual Deployment

103%

100%

105%

Percipio + Dual Deployment

102%

101%

104%

Skillport

72%

75%

83%

Total Content Business

95%

98%

96%

SumTotal Business

96%

101%

99%

Capital Structure

The following table sets forth Skillsoft’s cash and cash equivalents and long-term debt as of October 31, 2021:

$000s

October 31, 2021

Assets

Cash and Equivalents

$80,671

 

Liabilities

Long-Term Debt

$467,796

(including current portion)

Weighted average shares outstanding during the period from July 31, 2021 to October 31, 2021 were 133,116,361.

Webcast and Conference Call Information

Skillsoft will host a conference call and webcast today at 5:00 p.m. Eastern Time to discuss its financial results. To access the call, dial (877) 413-9278 from the United States and Canada or (215) 268-9914 from international locations. The live event can be accessed from the Investor Relations section of Skillsoft’s website at investor.skillsoft.com. A replay will be available for six months.

About Skillsoft

Skillsoft (NYSE: SKIL) is a global leader in corporate digital learning, focused on transforming today’s workforce for tomorrow’s economy. The Company provides enterprise learning solutions designed to prepare organizations for the future of work, overcome critical skill gaps, drive demonstrable behavior-change, and unlock the potential in their people. Skillsoft offers a comprehensive suite of premium, original, and authorized partner content, including one of the broadest and deepest libraries of leadership & business skills, technology & developer, and compliance curricula. With access to a broad spectrum of learning options (including video, audio, books, bootcamps, live events, and practice labs), organizations can meaningfully increase learner engagement and retention. Skillsoft’s offerings are delivered through Percipio, its award-winning, AI-driven, immersive learning platform purpose built to make learning easier, more accessible, and more effective. Learn more at www.skillsoft.com.

NON-GAAP FINANCIAL MEASURES AND KEY PERFORMANCE METRICS

We track several non-GAAP financial measures and key performance metrics that we believe are key financial measures of our success. Non-GAAP measures and key performance metrics are frequently used by securities analysts, investors, and other interested parties in their evaluation of companies comparable to us, many of which present non-GAAP measures and key performance metrics when reporting their results. These measures can be useful in evaluating our performance against our peer companies because we believe the measures provide users with valuable insight into key components of U.S. GAAP financial disclosures. For example, a company with higher U.S. GAAP net income may not be as appealing to investors if its net income is more heavily comprised of gains on asset sales. Likewise, excluding the effects of interest income and expense moderates the impact of a company’s capital structure on its performance. However, non-GAAP measures and key performance metrics have limitations as analytical tools. Because not all companies use identical calculations, our presentation of non-GAAP financial measures and key performance metrics may not be comparable to other similarly titled measures of other companies. They are not presentations made in accordance with U.S. GAAP, are not measures of financial condition or liquidity, and should not be considered as an alternative to profit or loss for the period determined in accordance with U.S. GAAP or operating cash flows determined in accordance with U.S. GAAP. As a result, these performance measures should not be considered in isolation from, or as a substitute analysis for, results of operations as determined in accordance with U.S. GAAP.

We do not reconcile our forward-looking non-GAAP financial measures to the corresponding U.S. GAAP measures, due to variability and difficulty in making accurate forecasts and projections and/or certain information not being ascertainable or accessible; and because not all of the information necessary for a quantitative reconciliation of these forward-looking non-GAAP financial measures to the most directly comparable U.S. GAAP financial measure is available to us without unreasonable efforts. For the same reasons, we are unable to address the probable significance of the unavailable information. We provide non-GAAP financial measures that we believe will be achieved, however we cannot accurately predict all of the components of the adjusted calculations and the U.S. GAAP measures may be materially different than the non-GAAP measures.

Forward Looking Statements

This document includes statements that are, or may be deemed to be, “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created by those laws. These forward-looking statements include information about possible or assumed future results of our operations. All statements, other than statements of historical facts, that address activities, events or developments that we expect or anticipate may occur in the future, including such things as our outlook (including bookings, adjusted revenue and adjusted EBITDA), our product development and planning, our pipeline, future capital expenditures, financial results, the impact of regulatory changes, existing and evolving business strategies and acquisitions and dispositions, demand for our services and competitive strengths, goals, the benefits of new initiatives, growth of our business and operations, our ability to successfully implement our plans, strategies, objectives, expectations and intentions are forward-looking statements. Also, when we use words such as “may,” “will,” “would,” “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “projects,” “forecasts,” “seeks,” “outlook,” “target,” goals,” “probably,” or similar expressions, we are making forward-looking statements. Such statements are based upon the current beliefs and expectations of Skillsoft’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. All forward-looking disclosure is speculative by its nature.

There are important risks, uncertainties, events and factors that could cause our actual results or performance to differ materially from those in the forward-looking statements contained in this document, including:

  • our ability to realize the benefits expected from the business combination between Skillsoft, Churchill Capital Corp. II and Global Knowledge;
  • the impact of changes in consumer spending patterns, consumer preferences, local, regional and national economic conditions, crime, weather, demographic trends and employee availability;
  • the impact of the ongoing COVID-19 pandemic (including any variant) on our business, operating results and financial condition;
  • fluctuations in our future operating results;
  • our ability to successfully identify, consummate and achieve strategic objectives in connection with our acquisition opportunities and realize the benefits expected from the acquisition;
  • the demand for, and acceptance of, our products and for cloud-based technology learning solutions in general;
  • our ability to compete successfully in competitive markets and changes in the competitive environment in our industry and the markets in which we operate;
  • our ability to market existing products and develop new products;
  • a failure of our information technology infrastructure or any significant breach of security, including in relation to the migration of our key platforms from our systems to cloud storage;
  • future regulatory, judicial and legislative changes in our industry;
  • our ability to comply with laws and regulations applicable to our business;
  • the impact of natural disasters, public health crises, political crises, or other catastrophic events;
  • our ability to attract and retain key employees and qualified technical and sales personnel;
  • fluctuations in foreign currency exchange rates;
  • our ability to protect or obtain intellectual property rights;
  • our ability to raise additional capital;
  • the impact of our indebtedness on our financial position and operating flexibility;
  • our ability to meet future liquidity requirements and comply with restrictive covenants related to long-term indebtedness;
  • our ability to successfully defend ourselves in legal proceedings; and
  • our ability to continue to meet applicable listing standards.

The foregoing list of factors is not exhaustive and new factors may emerge from time to time that could also affect actual performance and results. For more information, please see the risk factors included in the Company’s S-1 amendment filed on July 29, 2021 and subsequent filings with the SEC.

Although we believe that the assumptions underlying our forward-looking statements are reasonable, any of these assumptions, and therefore also the forward-looking statements based on these assumptions, could themselves prove to be inaccurate. Given the significant uncertainties inherent in the forward-looking statements included in this document, our inclusion of this information is not a representation or guarantee by us that our objectives and plans will be achieved. Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results. Additionally, statements as to market share, industry data and our market position are based on the most currently available data available to us and our estimates regarding market position or other industry data included in this document or otherwise discussed by us involve risks and uncertainties and are subject to change based on various factors, including as set forth above.

Our forward-looking statements speak only as of the date made and we will not update these forward-looking statements unless required by applicable law. With regard to these risks, uncertainties and assumptions, the forward-looking events discussed in this document may not occur, and we caution you against unduly relying on these forward-looking statements.

1 See “Non-GAAP Financial Measures and Key Performance Metrics.” The Company does not reconcile forward-looking non-GAAP measures.

2 Growth calculated compared to the prior year as if pre-combination Skillsoft and Global Knowledge had been combined and their fiscal quarters had been aligned to end on October 31, 2021.

3 Signifies non-GAAP measure. See “Non-GAAP Financial Measures and Key Performance Metrics” in this release.

 

SKILLSOFT CORP.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT NUMBER OF SHARES)

 

 

 

 

 

 

Successor

 

Predecessor (SLH)

 

 

October 31, 2021

 

January 31, 2021

ASSETS

 

 

 

 

Current Assets:

 

 

 

 

Cash and cash equivalents

 

$

80,671

 

 

$

71,479

 

Restricted cash

 

 

2,680

 

 

 

2,964

 

Accounts receivable, less reserves of approximately $2,173 and $294 as of October 31, 2021 and January 31, 2021 respectively

 

 

136,890

 

 

 

179,784

 

Prepaid expenses and other current assets

 

 

42,066

 

 

 

30,326

 

Total current assets

 

 

262,307

 

 

 

284,553

 

Property and equipment, net

 

 

17,253

 

 

 

13,780

 

Goodwill

 

 

872,291

 

 

 

495,004

 

Intangible assets, net

 

 

904,797

 

 

 

728,633

 

Right of use assets

 

 

21,928

 

 

 

15,131

 

Deferred tax asset

 

 

 

 

 

 

Other assets

 

 

10,083

 

 

 

8,636

 

Total assets

 

$

2,088,659

 

 

$

1,545,737

 

LIABILITIES AND SHAREHOLDER’S EQUITY

 

 

 

 

Current liabilities:

 

 

 

 

Current maturities of long-term debt

 

$

4,800

 

 

$

5,200

 

Borrowings under accounts receivable facility

 

 

11,080

 

 

 

17,022

 

Accounts payable

 

 

31,472

 

 

 

7,425

 

Accrued compensation

 

 

38,681

 

 

 

36,375

 

Accrued expenses and other current liabilities

 

 

55,772

 

 

 

23,125

 

Lease liabilities

 

 

7,687

 

 

 

4,740

 

Deferred revenue

 

 

246,188

 

 

 

257,549

 

Total current liabilities

 

 

395,680

 

 

 

351,436

 

Long-term debt

 

 

462,996

 

 

 

510,236

 

Warrant liabilities

 

 

65,363

 

 

 

900

 

Deferred tax liabilities

 

 

91,497

 

 

 

81,008

 

Long term lease liabilities

 

 

15,209

 

 

 

13,155

 

Deferred revenue – non-current

 

 

1,883

 

 

 

3,035

 

Other long-term liabilities

 

 

9,699

 

 

 

5,998

 

Total long-term liabilities

 

 

646,647

 

 

 

614,332

 

Commitments and contingencies

 

 

 

 

 

 

Shareholders’ equity:

 

 

 

 

(Predecessor SLH) Shareholders’ common stock- Class A and Class B common shares, $0.01 par value:

1,000,000,000 shares authorized (800,000,000 Class A, 200,000,000 Class B) at January 31, 2021; 4,000,000 shares issued and outstanding (3,840,000 Class A, 160,000 Class B) at January 31, 2021

 

 

 

 

 

40

 

(Successor) Shareholders’ common stock- Class A common shares, $0.0001 par value: 375,000,000 shares authorized and 133,164,526 shares issued and outstanding at October 31, 2021

 

 

11

 

 

 

 

Additional paid-in capital

 

 

1,301,319

 

 

 

674,333

 

Accumulated deficit

 

 

(255,132

)

 

 

(93,722

)

Accumulated other comprehensive income (loss)

 

 

134

 

 

 

(682

)

Total shareholders’ equity

 

 

1,046,332

 

 

 

579,969

 

Total liabilities and shareholders’ equity

 

$

2,088,659

 

 

$

1,545,737

 

 

SKILLSOFT CORP.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

 

 

 

Quarter-to Date Results

 

 

Fiscal 2022

 

Fiscal 2021

 

Successor

Predecessor (SLH)

Predecessor (PL)

 

 

Three Months Ended
October 31, 2021

 

From August 28, 2020
to October 31, 2020

 

From August 1, 2020
to August 27, 2020

Revenues:

 

 

 

 

 

 

Total revenues

 

$

170,559

 

 

$

36,973

 

 

$

38,687

 

Operating expenses:

 

 

 

 

 

 

Costs of revenues

 

 

48,891

 

 

 

15,882

 

 

 

6,329

 

Content and software development

 

 

16,437

 

 

 

10,919

 

 

 

5,208

 

Selling and marketing

 

 

39,938

 

 

 

18,193

 

 

 

8,259

 

General and administrative

 

 

28,120

 

 

 

10,075

 

 

 

5,440

 

Amortization of intangible assets

 

 

37,064

 

 

 

15,890

 

 

 

4,230

 

Recapitalization and acquisition-related costs

 

 

3,687

 

 

 

8,225

 

 

 

64

 

Restructuring

 

 

777

 

 

 

80

 

 

 

38

 

Total operating expenses

 

 

174,914

 

 

 

79,264

 

 

 

29,568

 

Operating (loss) income

 

 

(4,355

)

 

 

(42,291

)

 

 

9,119

 

Other (expense) income, net

 

 

(611

)

 

 

717

 

 

 

(541

)

Fair value adjustment of warrants

 

 

(36,838

)

 

 

2,900

 

 

 

 

Interest income

 

 

18

 

 

 

9

 

 

 

21

 

Interest expense

 

 

(7,510

)

 

 

(7,919

)

 

 

(1,287

)

Reorganization items, net

 

 

 

 

 

 

 

 

3,339,837

 

Loss (income) before (benefit from) provision for income taxes

 

 

(49,296

)

 

 

(46,584

)

 

 

3,347,149

 

(Benefit from) provision for income taxes

 

 

(6,441

)

 

 

(7,870

)

 

 

78,254

 

Net (loss) income

 

 

(42,855

)

 

 

(38,714

)

 

 

3,268,895

 

 

 

 

 

 

 

 

(Loss) income per share:

 

 

 

 

 

 

Ordinary – Basic and Diluted (PL)

 

 

*

 

 

 

*

 

 

 

32,656.29

 

Class A and B – Basic and Diluted (SLH)

 

 

*

 

 

 

(9.68

)

 

 

*

 

Ordinary – Basic and Diluted (Successor)

 

 

(0.32

)

 

 

*

 

 

 

*

 

Weighted average common share outstanding:

 

 

 

 

 

 

Ordinary – Basic and Diluted (PL)

 

 

*

 

 

 

*

 

 

 

100.1

 

Class A and B – Basic and Diluted (SLH)

 

 

*

 

 

 

4,000

 

 

 

*

 

Ordinary – Basic and Diluted (Successor)

 

 

133,116

 

 

 

*

 

 

 

*

 

 

*Not applicable

The accompanying notes are an integral part of these consolidated financial statements.

 

SKILLSOFT CORP.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

 

 

 

Year-to Date Results

 

 

Fiscal 2022

 

Fiscal 2021

 

 

Successor

Predecessor (SLH)

Predecessor (SLH)

Predecessor (PL)

 

 

From

June 12, 2021 to

October 31, 2021

 

From

February 1, 2021

to June 11, 2021

 

From

August 28, 2020

to October 31, 2020

 

From

February 1, 2020

to August 27, 2020

Revenues:

 

 

 

 

 

 

 

 

Total revenues

 

$

261,572

 

 

$

139,636

 

 

$

36,973

 

 

$

273,851

 

Operating expenses:

 

 

 

 

 

 

 

 

Costs of revenues

 

 

76,897

 

 

 

35,881

 

 

 

15,882

 

 

 

52,160

 

Content and software development

 

 

26,316

 

 

 

24,084

 

 

 

10,919

 

 

 

38,986

 

Selling and marketing

 

 

62,171

 

 

 

41,940

 

 

 

18,193

 

 

 

75,028

 

General and administrative

 

 

45,194

 

 

 

17,217

 

 

 

10,075

 

 

 

37,455

 

Amortization of intangible assets

 

 

57,087

 

 

 

50,902

 

 

 

15,890

 

 

 

34,378

 

Impairment of intangible assets

 

 

 

 

 

 

 

 

 

 

 

332,376

 

Recapitalization and acquisition-related costs

 

 

13,682

 

 

 

6,938

 

 

 

8,225

 

 

 

32,099

 

Restructuring

 

 

1,093

 

 

 

(703

)

 

 

80

 

 

 

1,179

 

Total operating expenses

 

 

282,440

 

 

 

176,259

 

 

 

79,264

 

 

 

603,661

 

Operating loss

 

 

(20,868

)

 

 

(36,623

)

 

 

(42,291

)

 

 

(329,810

)

Other (expense) income, net

 

 

(1,308

)

 

 

(493

)

 

 

717

 

 

 

1,268

 

Fair value adjustment of warrants

 

 

(19,723

)

 

 

900

 

 

 

2,900

 

 

 

 

Interest income

 

 

30

 

 

 

64

 

 

 

9

 

 

 

105

 

Interest expense

 

 

(17,366

)

 

 

(16,820

)

 

 

(7,919

)

 

 

(168,341

)

Reorganization items, net

 

 

 

 

 

 

 

 

 

 

 

3,329,245

 

Loss (income) before (benefit from) provision for income taxes

 

 

(59,235

)

 

 

(52,972

)

 

 

(46,584

)

 

 

2,832,467

 

(Benefit from) provision for income taxes

 

 

(4,527

)

 

 

(3,708

)

 

 

(7,870

)

 

 

68,455

 

Net (loss) income

 

 

(54,708

)

 

 

(49,264

)

 

 

(38,714

)

 

 

2,764,012

 

 

 

 

 

 

 

 

 

 

(Loss) income per share:

 

 

 

 

 

 

 

 

Ordinary – Basic and Diluted (PL)

 

 

*

 

 

 

*

 

 

 

*

 

 

 

27,612.51

 

Class A and B – Basic and Diluted (SLH)

 

 

*

 

 

 

(12.32

)

 

 

(9.68

)

 

 

*

 

Ordinary – Basic and Diluted (Successor)

 

 

(0.41

)

 

 

*

 

 

 

*

 

 

*

 

Weighted average common share outstanding:

 

 

 

 

 

 

 

 

Ordinary – Basic and Diluted (PL)

 

 

*

 

 

 

*

 

 

 

*

 

 

 

100.1

 

Class A and B – Basic and Diluted (SLH)

 

 

*

 

 

 

4,000

 

 

 

4,000

 

 

 

*

 

Ordinary – Basic and Diluted (Successor)

 

 

133,096

 

 

 

*

 

 

 

*

 

 

 

*

 

*Not applicable

The accompanying notes are an integral part of these consolidated financial statements.

SKILLSOFT CORP.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

 

 

 

Fiscal 2022

 

Fiscal 2021

 

 

Successor

 

 

Predecessor (SL)

 

Predecessor (SL)

 

 

Predecessor (PL)

 

 

June 12, 2021
through
October 31, 2021

 

 

February 1, 2021
through
June 11, 2021

 

August 28, 2020
through
October 31, 2020

 

 

February 1, 2020
through
August 27, 2020

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

Net (loss) income

 

$

(54,708

)

 

 

$

(49,264

)

 

$

(38,714

)

 

 

$

2,764,012

 

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

 

 

 

 

 

 

 

 

 

 

Share-based compensation

 

 

9,034

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

4,309

 

 

 

 

3,572

 

 

 

1,509

 

 

 

 

5,864

 

Amortization of intangible assets

 

 

57,087

 

 

 

 

50,902

 

 

 

15,890

 

 

 

 

34,378

 

Change in bad debt reserve

 

 

(668

)

 

 

 

(174

)

 

 

186

 

 

 

 

24

 

(Benefit from) provision for income taxes – non-cash

 

 

(9,937

)

 

 

 

(5,886

)

 

 

(8,214

)

 

 

 

66,234

 

Non-cash interest expense

 

 

913

 

 

 

 

487

 

 

 

143

 

 

 

 

2,407

 

Impairment of intangible assets

 

 

 

 

 

 

 

 

 

 

 

 

 

332,376

 

Fair value adjustment to warrants

 

 

19,723

 

 

 

 

(900

)

 

 

(2,900

)

 

 

 

 

Right-of-use asset

 

 

3,473

 

 

 

 

748

 

 

 

1,245

 

 

 

 

1,594

 

Non-cash reorganization items, net

 

 

 

 

 

 

 

 

 

 

 

 

 

(3,353,326

)

Changes in current assets and liabilities, net of effects from acquisitions:

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(8,446

)

 

 

 

88,622

 

 

 

(24,396

)

 

 

 

116,478

 

Prepaid expenses and other current assets

 

 

(5,002

)

 

 

 

1,828

 

 

 

(4,017

)

 

 

 

66

 

Accounts payable

 

 

(1,636

)

 

 

 

(4,866

)

 

 

3,776

 

 

 

 

(7,909

)

Accrued expenses, including long-term

 

 

13,962

 

 

 

 

(18,592

)

 

 

11,888

 

 

 

 

145,816

 

Lease liability

 

 

(4,046

)

 

 

 

(1,301

)

 

 

(1,510

)

 

 

 

(2,332

)

Deferred revenue

 

 

(24,599

)

 

 

 

(31,365

)

 

 

47,987

 

 

 

 

(101,765

)

Net cash (used in) provided by operating activities

 

 

(541

)

 

 

 

33,811

 

 

 

2,873

 

 

 

 

3,917

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

Purchase of property and equipment

 

 

(4,351

)

 

 

 

(641

)

 

 

(1,340

)

 

 

 

(3,105

)

Internally developed software – capitalized costs

 

 

(2,293

)

 

 

 

(2,350

)

 

 

(908

)

 

 

 

(3,819

)

Acquisition of Global Knowledge, net of cash received

 

 

(156,926

)

 

 

 

 

 

 

 

 

 

 

 

Acquisition of Skillsoft, net of cash received

 

 

(386,035

)

 

 

 

 

 

 

 

 

 

 

 

Acquisition of Pluma, net of cash received

 

 

(18,646

)

 

 

 

 

 

 

 

 

 

 

 

Net cash used in investing activities

 

 

(568,251

)

 

 

 

(2,991

)

 

 

(2,248

)

 

 

 

(6,924

)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

Borrowings under revolving line of credit, net of repayments

 

 

 

 

 

 

 

 

 

 

 

 

 

19,500

 

Borrowings under DIP Facility

 

 

 

 

 

 

 

 

 

 

 

 

 

60,000

 

Proceeds from Exit Facility borrowing

 

 

 

 

 

 

 

 

 

 

 

 

 

50,000

 

Debt issuance costs associated with DIP and Exit facilities

 

 

 

 

 

 

 

 

 

 

 

 

 

(19,524

)

Shares repurchased for tax withholding upon vesting of restricted stock-based awarded

 

 

(614

)

 

 

 

 

 

 

 

 

 

 

 

Proceeds from equity investment (PIPE)

 

 

530,000

 

 

 

 

 

 

 

 

 

 

 

 

Proceeds from issuance of term loans, net of fees

 

 

464,290

 

 

 

 

 

 

 

 

 

 

 

 

Principal payments on capital lease obligation

 

 

(407

)

 

 

 

(370

)

 

 

(162

)

 

 

 

(532

)

Proceeds from accounts receivable facility, net of borrowings

 

 

(23,198

)

 

 

 

16,577

 

 

 

(28,909

)

 

 

 

(35,787

)

Repayment of First and Second Out loans

 

 

(605,591

)

 

 

 

(1,300

)

 

 

 

 

 

 

 

Net cash provided by (used in) financing activities

 

 

364,480

 

 

 

 

14,907

 

 

 

(29,071

)

 

 

 

73,657

 

Effect of exchange rate changes on cash and cash equivalents

 

 

(820

)

 

 

 

203

 

 

 

699

 

 

 

 

(2,139

)

Net (decrease) increase in cash, cash equivalents and restricted cash

 

 

(205,132

)

 

 

 

45,930

 

 

 

(27,747

)

 

 

 

68,511

 

Cash, cash equivalents and restricted cash, beginning of period

 

 

288,483

 

 

 

 

74,443

 

 

 

102,315

 

 

 

 

33,804

 

Cash, cash equivalents and restricted cash, end of period

 

$

83,351

 

 

 

$

120,373

 

 

$

74,568

 

 

 

$

102,315

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

80,671

 

 

 

$

117,299

 

 

$

70,836

 

 

 

$

92,009

 

Restricted cash

 

 

2,680

 

 

 

 

3,074

 

 

 

3,732

 

 

 

 

10,306

 

Cash, cash equivalents and restricted cash, end of period

 

$

83,351

 

 

 

$

120,373

 

 

$

74,568

 

 

 

$

102,315

 

 

The accompanying notes are an integral part of these consolidated financial statements.

Contacts

Investors
James Gruskin

james.gruskin@skillsoft.com

Media
Caitlin Leddy

caitlin.leddy@skillsoft.com

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