BOSTON, Oct. 26, 2017 (GLOBE NEWSWIRE) -- LogMeIn, Inc. (NASDAQ:LOGM), a leading provider of cloud-based connectivity, today announced its results for the third quarter ended September 30, 2017.
Third quarter 2017 highlights include:
- GAAP revenue was $269.3 million and non-GAAP revenue was $276.1 million
- GAAP net income was $9.9 million or $0.19 per diluted share and non-GAAP net income was $62.1 million or $1.16 per diluted share
- EBITDA was $67.3 million or 25.0% of GAAP revenue, and Adjusted EBITDA was $104.0 million or 37.7% of non-GAAP revenue
- Cash Flow from Operations was $90.5 million or 32.8% of non-GAAP revenue, and Adjusted Cash Flow from Operations was $102.5 million or 37.1% of non-GAAP revenue
- Total deferred revenue was $328.5 million
- The Company closed the quarter with cash, cash equivalents and short-term investments of $276.0 million
“The Company continued to perform well, with revenue, adjusted EBITDA, and non-GAAP earnings per share above the high-end of our guidance,” said Bill Wagner, President and CEO of LogMeIn. “We are also pleased with the success we have made integrating these businesses to create a software leader with a compelling profile.”
Business Outlook
Based on information available as of October 26, 2017, the Company is issuing guidance for the fourth quarter 2017 and fiscal year 2017. Since the Company’s merger with Citrix Systems, Inc.’s GetGo, Inc. subsidiary (referred to below as “GoTo”) officially closed on January 31, 2017, the Company’s business outlook for fiscal year 2017 excludes GoTo’s January 2017 results.
Fourth Quarter 2017: The Company expects fourth quarter non-GAAP revenue to be in the range of $277 million to $278 million. The Company expects fourth quarter GAAP revenue to be in the range of $273 million to $274 million. Non-GAAP revenue adds back $4 million for the impact of an acquisition accounting adjustment recorded to reduce GoTo’s deferred revenue balance to the fair value of the remaining obligation.
Adjusted EBITDA is expected to be in the range of $105 million to $106 million, or approximately 38% of non-GAAP revenue. EBITDA is expected to be in the range of $71 million to $72 million, or approximately 26% of GAAP revenue.
Non-GAAP net income is expected to be in the range of $62 million to $63 million, or $1.16 to $1.17 per diluted share. Non-GAAP net income adds back the $4 million non-GAAP revenue adjustment described above and excludes an estimated $19 million in stock-based compensation expense, $10 million in acquisition and litigation related costs, $50 million of amortization expense of acquired intangible assets and also includes $4 million of amortization expense for GoTo’s internally capitalized software development costs that were adjusted in acquisition accounting to fair value, as well as the income tax effect of the above items and discrete integration related tax items.
Non-GAAP net income for the fourth quarter assumes an effective tax rate of approximately 30% and non-GAAP net income per diluted share is based on an estimated 53.5 million fully-diluted weighted average shares outstanding.
Including stock-based compensation expense, acquisition and litigation related costs, amortization expense, and excluding the acquisition accounting adjustments to revenue and amortization expense, the Company expects to report GAAP net income in the range of $11 million to $12 million, or $0.21 to $0.22 per diluted share.
GAAP net income for the fourth quarter assumes a tax benefit of approximately $2 million and GAAP net income per share is based on an estimated 53.5 million fully-diluted weighted average shares outstanding.
Fiscal Year 2017: The Company expects full year 2017 non-GAAP revenue to be in the range of $1.021 billion to $1.022 billion, which excludes GoTo’s January 2017 revenue of $58 million. The Company expects full year 2017 GAAP revenue to be in the range of $987 million to $988 million. Non-GAAP revenue adds back $34 million for the impact of an acquisition accounting adjustment recorded to reduce GoTo’s deferred revenue balance to the fair value of the remaining obligation.
Adjusted EBITDA is expected to be in the range of $366 million to $369 million, or approximately 36% of non-GAAP revenue. EBITDA is expected to be in the range of $201 million to $204 million, or approximately 20% of GAAP revenue.
Non-GAAP net income is expected to be in the range of $214 million to $217 million, or $4.16 to $4.22 per diluted share. Non-GAAP net income adds back the $34 million non-GAAP revenue adjustment described above and excludes an estimated $68 million in stock-based compensation expense, $63 million in acquisition and litigation related costs, $183 million of amortization expense of acquired intangible assets and also includes $20 million of amortization expense for GoTo’s internally capitalized software development costs that were adjusted in acquisition accounting to fair value, as well as the income tax effect of the above items and discrete integration related tax items.
Non-GAAP net income for the full fiscal year 2017 assumes an effective tax rate of approximately 30% and non-GAAP net income per diluted share is based on an estimated 51.5 million fully-diluted weighted average shares outstanding.
Including stock-based compensation expense, acquisition and litigation related costs, amortization expense, and excluding the acquisition accounting adjustments to revenue and amortization expense, the Company expects to report GAAP net income in the range of $15 million to $18 million, or $0.29 to $0.35 per diluted share.
GAAP net income for the full year assumes a tax benefit of approximately $35 million. GAAP net income per share is based on an estimated 51.5 million fully-diluted weighted average shares outstanding.
Dividend
In accordance with its previously announced capital return plan, the Company will pay a $0.25 per share dividend on November 24, 2017 to stockholders of record as of November 8, 2017. The Company currently has approximately 52.6 million shares of common stock outstanding.
Conference Call Information for Today, Thursday, October 26, 2017
The Company will host a corresponding conference call and live webcast at 5:00 p.m. Eastern Time today. To access the conference call, dial 800-239-9838 (for the U.S. and Canada) or 323-794-2551 (for international callers) and entering passcode 6598155. A live webcast will be available on the Investor Relations section of the Company’s corporate website at https://www.logmeininc.com and via replay beginning approximately two hours after the completion of the call until the Company’s announcement of its financial results for the next quarter. An audio replay of the call will also be available to investors beginning at approximately 8:00 p.m. Eastern Time on October 26, 2017 until 8:00 p.m. Eastern Time on November 3, 2017, by dialing 719-457-0820 and entering passcode 6598155.
Our Use of Non-GAAP Financial Measures
This press release contains non-GAAP financial measures including non-GAAP revenue, EBITDA, EBITDA margin, adjusted EBITDA, adjusted EBITDA margin, non-GAAP operating income, non-GAAP income before provision for income taxes, non-GAAP provision for income taxes, non-GAAP net income, non-GAAP net income per diluted share and adjusted cash flow from operations.
- Non-GAAP revenue is GAAP revenue and adds back the impact of the fair value acquisition accounting adjustment on acquired GoTo’s deferred revenue.
- EBITDA is GAAP net income excluding provision for income taxes, interest income, interest expense, and other (expense) income net, and depreciation and amortization.
- EBITDA margin is calculated by dividing EBITDA by revenue.
- Adjusted EBITDA is GAAP net income excluding provision for income taxes, interest income, interest expense, and other (expense) income net, depreciation and amortization, acquisition and litigation related costs, stock-based compensation expense, and adds back the impact of the fair value acquisition accounting adjustment on acquired GoTo’s deferred revenue.
- Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by non-GAAP revenue, or GAAP revenue if not different.
- Non-GAAP operating income is GAAP operating income and adds back the impact of the fair value acquisition accounting adjustment on acquired GoTo’s deferred revenue and excludes acquisition related costs and amortization, litigation related costs, stock-based compensation expense, and also includes amortization expense for GoTo’s internally capitalized software development costs that were adjusted in acquisition accounting to fair value.
- Non-GAAP provision for income taxes is GAAP provision (benefit) for incomes taxes and excludes the tax impact of the fair value acquisition accounting adjustment on acquired GoTo’s deferred revenue, acquisition related costs and amortization, litigation related costs, stock-based compensation expense, discrete integration related tax impacts and also includes the tax impact of amortization expense for GoTo’s internally capitalized software development costs that were adjusted in acquisition accounting to fair value.
- Non-GAAP net income and non-GAAP net income per diluted share reflects the adjustments noted in non-GAAP operating income and non-GAAP provision for income taxes above.
- Adjusted cash flow from operations excludes acquisition and litigation related payments.
The exclusion of certain expenses in the calculation of non-GAAP financial measures should not be construed as an inference that these costs are unusual or infrequent. We anticipate excluding these expenses in the future presentation of our non-GAAP financial measures. The Company believes that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to the Company's financial condition and results of operations. The Company's management uses these non-GAAP measures to compare the Company's performance to that of prior periods and uses these measures in financial reports prepared for management and the Company's board of directors. The Company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and to compare the Company's financial measures with other software-as-a-service companies, many of which present similar non-GAAP financial measures to investors. The Company does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant elements that are required by GAAP to be recorded in the Company's financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management in determining these non-GAAP financial measures. In order to compensate for these limitations, management of the Company presents its non-GAAP financial measures in connection with its GAAP results. The Company urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing quarterly financial results, and not to rely on any single financial measure to evaluate the Company's business. Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP measures used in this press release are included in this release.
About LogMeIn, Inc.
LogMeIn, Inc. (NASDAQ:LOGM) simplifies how people connect with each other and the world around them to drive meaningful interactions, deepen relationships, and create better outcomes for individuals and businesses. One of the world’s top 10 public SaaS companies, and a market leader in communication & conferencing, identity & access, and customer engagement & support solutions, LogMeIn has millions of customers spanning virtually every country across the globe. LogMeIn is headquartered in Boston with additional locations in North America, Europe, Asia and Australia.
Cautionary Language Concerning Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding the Company's integration progress and the Company's financial guidance for fiscal year 2017 and the fourth quarter of 2017. These forward-looking statements are made as of the date they were first issued and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as "expect," "anticipate," "should," "believe," "hope," "target," "project," "goals," "estimate," "potential," "predict," "may," "will," "might," "could," "intend," variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond the Company's control. The Company's actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to, customer adoption of the Company's solutions, the Company’s ability to execute on its strategic initiatives, failure to realize the estimated synergies or growth from the Company’s merger with GetGo, Inc. or that such benefits may take longer to realize than expected, the Company’s ability to integrate acquired products or companies, the disruption of ongoing business operations and the diversion of management’s attention due to the work required to successfully integrate GoTo’s business, unanticipated costs of integration, the Company's ability to attract new customers and retain existing customers, adverse economic conditions in general and adverse economic conditions specifically affecting the markets in which the Company operates, the effectiveness of the Company’s cybersecurity measures, the Company's ability to continue to promote and maintain its brand in a cost-effective manner, the Company's ability to compete effectively, the Company's ability to develop and introduce new products and add-ons or enhancements to existing products, the Company's ability to manage growth, the Company's ability to attract and retain key personnel, the Company's ability to protect its intellectual property and other proprietary rights, the result of any pending litigation including intellectual property litigation, and other risks detailed in the Company's other publicly available filings with the Securities and Exchange Commission. Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent the Company's views as of the date of this press release. The Company anticipates that subsequent events and developments will cause its views to change. The Company undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing the Company's views as of any date subsequent to the date of this press release.
LogMeIn is a registered trademark of LogMeIn, Inc. in the US and other countries around the world.
Contact Information:
Investors
Rob Bradley
LogMeIn, Inc.
781-897-1301
rbradley@LogMeIn.com
Press
Craig VerColen
LogMeIn, Inc.
781-897-0696
Press@LogMeIn.com
| LogMeIn, Inc. | ||||||||||
| Condensed Consolidated Balance Sheets (unaudited) | ||||||||||
| (In thousands) | ||||||||||
| December 31, | September 30, | |||||||||
| 2016 | 2017 | |||||||||
| ASSETS | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | 140,756 | $ | 262,051 | ||||||
| Marketable securities | 55,710 | 13,996 | ||||||||
| Accounts receivable, net | 25,901 | 83,862 | ||||||||
| Prepaid expenses and other current assets | 5,723 | 34,412 | ||||||||
| Total current assets | 228,090 | 394,321 | ||||||||
| Property and equipment, net | 23,867 | 91,401 | ||||||||
| Restricted cash | 2,481 | 1,661 | ||||||||
| Intangibles, net | 62,510 | 1,191,609 | ||||||||
| Goodwill | 121,760 | 2,254,773 | ||||||||
| Other assets | 4,282 | 7,295 | ||||||||
| Deferred tax assets | 303 | 276 | ||||||||
| Total assets | $ | 443,293 | $ | 3,941,336 | ||||||
| LIABILITIES AND EQUITY | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable | $ | 14,640 | $ | 37,117 | ||||||
| Accrued liabilities | 35,253 | 110,675 | ||||||||
| Deferred revenue, current portion | 156,966 | 323,044 | ||||||||
| Total current liabilities | 206,859 | 470,836 | ||||||||
| Long-term debt | 30,000 | - | ||||||||
| Deferred revenue, net of current portion | 5,287 | 5,468 | ||||||||
| Deferred tax liabilities | 2,332 | 376,006 | ||||||||
| Other long-term liabilities | 2,699 | 7,174 | ||||||||
| Total liabilities | 247,177 | 859,484 | ||||||||
| Commitments and contingencies | ||||||||||
| Preferred stock | - | - | ||||||||
| Equity: | ||||||||||
| Common stock | 284 | 560 | ||||||||
| Additional paid-in capital | 314,700 | 3,261,762 | ||||||||
| Accumulated deficit | (1,754 | ) | (29,719 | ) | ||||||
| Accumulated other comprehensive income (loss) | (6,618 | ) | 10,820 | |||||||
| Treasury stock | (110,496 | ) | (161,571 | ) | ||||||
| Total equity | 196,116 | 3,081,852 | ||||||||
| Total liabilities and equity | $ | 443,293 | $ | 3,941,336 | ||||||
| LogMeIn, Inc. | ||||||||||||||||||||
| Condensed Consolidated Statements of Operations (unaudited) | ||||||||||||||||||||
| (In thousands, except per share data) | ||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||
| 2016 | 2017 | 2016 | 2017 | |||||||||||||||||
| Revenue | $ | 85,103 | $ | 269,267 | $ | 248,103 | $ | 713,750 | ||||||||||||
| Cost of revenue | 11,485 | 55,605 | 34,121 | 147,780 | ||||||||||||||||
| Gross profit | 73,618 | 213,662 | 213,982 | 565,970 | ||||||||||||||||
| Operating expenses: | ||||||||||||||||||||
| Research and development | 14,161 | 42,603 | 43,571 | 116,435 | ||||||||||||||||
| Sales and marketing | 39,628 | 89,379 | 123,533 | 258,616 | ||||||||||||||||
| General and administrative | 18,694 | 37,906 | 40,350 | 120,460 | ||||||||||||||||
| Amortization of acquired intangibles | 1,363 | 36,613 | 4,103 | 97,187 | ||||||||||||||||
| Total operating expenses | 73,846 | 206,501 | 211,557 | 592,698 | ||||||||||||||||
| Income (loss) from operations | (228 | ) | 7,161 | 2,425 | (26,728 | ) | ||||||||||||||
| Interest income | 177 | 405 | 546 | 924 | ||||||||||||||||
| Interest expense | (335 | ) | (294 | ) | (1,094 | ) | (1,088 | ) | ||||||||||||
| Other income (expense), net | (180 | ) | 51 | (676 | ) | (27 | ) | |||||||||||||
| Income (loss) before income taxes | (566 | ) | 7,323 | 1,201 | (26,919 | ) | ||||||||||||||
| (Provision for) benefit from income taxes | (91 | ) | 2,597 | (425 | ) | 33,121 | ||||||||||||||
| Net income (loss) | $ | (657 | ) | $ | 9,920 | $ | 776 | $ | 6,202 | |||||||||||
| Net income (loss) per share: | ||||||||||||||||||||
| Basic | $ | (0.03 | ) | $ | 0.19 | $ | 0.03 | $ | 0.12 | |||||||||||
| Diluted | $ | (0.03 | ) | $ | 0.19 | $ | 0.03 | $ | 0.12 | |||||||||||
| Weighted average shares outstanding: | ||||||||||||||||||||
| Basic | 25,401 | 52,706 | 25,230 | 49,697 | ||||||||||||||||
| Diluted | 25,401 | 53,606 | 26,009 | 50,735 | ||||||||||||||||
| LogMeIn, Inc. | ||||||||||||||||||||
| Calculation of Non-GAAP Revenue (unaudited) | ||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||
| 2016 | 2017 | 2016 | 2017 | |||||||||||||||||
| (in thousands) | (in thousands) | |||||||||||||||||||
| GAAP Revenue | $ | 85,103 | $ | 269,267 | $ | 248,103 | $ | 713,750 | ||||||||||||
| Add Back: | ||||||||||||||||||||
| Effect of acquisition accounting on fair value of acquired deferred revenue | - | 6,856 | - | 30,427 | ||||||||||||||||
| Non-GAAP Revenue | $ | 85,103 | $ | 276,123 | $ | 248,103 | $ | 744,177 | ||||||||||||
| Calculation of Non-GAAP Operating Income, Non-GAAP Net Income and Non-GAAP Net Income per Diluted Share (unaudited) | ||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||
| 2016 | 2017 | 2016 | 2017 | |||||||||||||||||
| (In thousands, except per share data) | (In thousands, except per share data) | |||||||||||||||||||
| GAAP Net income (loss) from operations | $ | (228 | ) | $ | 7,161 | $ | 2,425 | $ | (26,728 | ) | ||||||||||
| Add Back: | ||||||||||||||||||||
| Effect of acquisition accounting on fair value of acquired deferred revenue | - | 6,856 | - | 30,427 | ||||||||||||||||
| Stock-based compensation expense | 8,999 | 18,765 | 27,327 | 49,255 | ||||||||||||||||
| Acquisition related costs | 10,645 | 10,455 | 16,884 | 51,391 | ||||||||||||||||
| Litigation related expenses | - | 622 | 35 | 1,360 | ||||||||||||||||
| Amortization of acquired intangibles | 2,512 | 49,842 | 7,557 | 132,603 | ||||||||||||||||
| Effect of acquisition accounting on internally capitalized software development costs | - | (5,080 | ) | - | (16,025 | ) | ||||||||||||||
| Non-GAAP Operating income | 21,928 | 88,621 | 54,228 | 222,283 | ||||||||||||||||
| Interest and other expense, net | (338 | ) | 162 | (1,224 | ) | (191 | ) | |||||||||||||
| Non-GAAP Income before income taxes | 21,590 | 88,783 | 53,004 | 222,092 | ||||||||||||||||
| Non-GAAP Provision for income taxes | (6,829 | ) | (26,638 | ) | (16,442 | ) | (67,404 | ) | ||||||||||||
| Non-GAAP Net income | $ | 14,761 | $ | 62,145 | $ | 36,562 | $ | 154,688 | ||||||||||||
| Non-GAAP net income per diluted share | $ | 0.56 | $ | 1.16 | $ | 1.41 | $ | 3.05 | ||||||||||||
| Diluted weighted average shares outstanding used in | ||||||||||||||||||||
| computing per share amounts | 26,204 | 53,606 | 26,009 | 50,735 | ||||||||||||||||
| Calculation of EBITDA and Adjusted EBITDA (unaudited) | ||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||
| 2016 | 2017 | 2016 | 2017 | |||||||||||||||||
| (in thousands) | (in thousands) | |||||||||||||||||||
| GAAP Net (loss) income | $ | (657 | ) | $ | 9,920 | $ | 776 | $ | 6,202 | |||||||||||
| Add Back: | ||||||||||||||||||||
| Interest and other expense, net | 338 | (162 | ) | 1,224 | 191 | |||||||||||||||
| Income tax expense (benefit) | 91 | (2,597 | ) | 425 | (33,121 | ) | ||||||||||||||
| Amortization of acquired intangibles | 2,512 | 49,842 | 7,557 | 132,603 | ||||||||||||||||
| Depreciation and amortization expense | 2,860 | 10,333 | 8,519 | 26,158 | ||||||||||||||||
| EBITDA | 5,144 | 67,336 | 18,501 | 132,033 | ||||||||||||||||
| Add Back: | ||||||||||||||||||||
| Effect of acquisition accounting on fair value of acquired deferred revenue | - | 6,856 | - | 30,427 | ||||||||||||||||
| Stock-based compensation expense | 8,999 | 18,765 | 27,327 | 49,255 | ||||||||||||||||
| Acquisition related costs | 10,645 | 10,455 | 16,884 | 51,391 | ||||||||||||||||
| Litigation related expenses | - | 622 | 35 | 1,360 | ||||||||||||||||
| Adjusted EBITDA | $ | 24,788 | $ | 104,034 | $ | 62,747 | $ | 264,466 | ||||||||||||
| EBITDA Margin | 6.0 | % | 25.0 | % | 7.5 | % | 18.5 | % | ||||||||||||
| Adjusted EBITDA Margin | 29.1 | % | 37.7 | % | 25.3 | % | 35.5 | % | ||||||||||||
| Stock-Based Compensation Expense (unaudited) | ||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||
| 2016 | 2017 | 2016 | 2017 | |||||||||||||||||
| (in thousands) | (in thousands) | |||||||||||||||||||
| Cost of revenue | $ | 536 | $ | 1,612 | $ | 1,774 | $ | 3,911 | ||||||||||||
| Research and development | 1,476 | 6,405 | 4,702 | 16,042 | ||||||||||||||||
| Sales and marketing | 4,398 | 4,312 | 12,876 | 12,108 | ||||||||||||||||
| General and administrative | 2,589 | 6,436 | 7,975 | 17,194 | ||||||||||||||||
| Total stock based-compensation | $ | 8,999 | $ | 18,765 | $ | 27,327 | $ | 49,255 | ||||||||||||
| LogMeIn, Inc. | ||||||
| Calculation of Projected 2017 Non-GAAP Revenue (unaudited) | ||||||
| (In millions) | ||||||
| Three Months Ended | Twelve Months Ended | |||||
| December 31, 2017 | December 31, 2017 | |||||
| GAAP Revenue | $273 - $274 | $987 - $988 | ||||
| Add Back: | ||||||
| Effect of acquisition accounting on fair value of acquired deferred revenue | 4 | 34 | ||||
| Non-GAAP Revenue | $277 - $278 | $1,021 - $1,022 | ||||
| Calculation of Projected 2017 Non-GAAP Net Income and Non-GAAP Net Income per Diluted Share (unaudited) | ||||||
| (In millions, except per share data) | ||||||
| Three Months Ended | Twelve Months Ended | |||||
| December 31, 2017 | December 31, 2017 | |||||
| GAAP Net income | $11 - $12 | $15 - $18 | ||||
| Add Back: | ||||||
| Effect of acquisition accounting on fair value of acquired deferred revenue | 4 | 34 | ||||
| Stock-based compensation expense | 19 | 68 | ||||
| Acquisition and litigation related costs | 10 | 63 | ||||
| Amortization of acquired intangibles | 50 | 183 | ||||
| Effect of acquisition accounting on internally capitalized software development costs | (4) | (20) | ||||
| Income tax effect of non-GAAP items | (29) | (129) | ||||
| Non-GAAP Net income | $62 - $63 | $214 - $217 | ||||
| GAAP net income per diluted share | $0.21 - $0.22 | $0.29 - $0.35 | ||||
| Non-GAAP net income per diluted share | $1.16 - $1.17 | $4.16 - $4.22 | ||||
| Diluted weighted average shares outstanding used in computing income per share | 53.5 | 51.5 | ||||
| Calculation of Projected 2017 EBITDA and Adjusted EBITDA (unaudited) | ||||||
| (In millions) | ||||||
| Three Months Ended | Twelve Months Ended | |||||
| December 31, 2017 | December 31, 2017 | |||||
| GAAP Net income | $11 - $12 | $15 - $18 | ||||
| Add Back: | ||||||
| Interest and other (income) expense, net | - | - | ||||
| Income tax benefit | (2) | (35) | ||||
| Amortization of acquired intangibles | 50 | 183 | ||||
| Depreciation and amortization expense | 12 | 38 | ||||
| EBITDA | 71 - 72 | 201 - 204 | ||||
| Add Back: | ||||||
| Effect of acquisition accounting on fair value of acquired deferred revenue | 4 | 34 | ||||
| Stock-based compensation expense | 19 | 68 | ||||
| Acquisition and litigation related costs | 10 | 63 | ||||
| Adjusted EBITDA | $105 - $106 | $366 - $369 | ||||
| EBITDA Margin | 26% | 20% | ||||
| Adjusted EBITDA Margin | 38% | 36% | ||||
| LogMeIn, Inc. | |||||||||||||||||||
| Condensed Consolidated Statements of Cash Flows (unaudited) | |||||||||||||||||||
| (In thousands) | |||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||
| 2016 | 2017 | 2016 | 2017 | ||||||||||||||||
| Cash flows from operating activities | |||||||||||||||||||
| Net (loss) income | $ | (657 | ) | $ | 9,920 | $ | 776 | $ | 6,202 | ||||||||||
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: | |||||||||||||||||||
| Stock-based compensation | 8,999 | 18,765 | 27,327 | 49,255 | |||||||||||||||
| Depreciation and amortization | 5,372 | 60,175 | 16,076 | 158,761 | |||||||||||||||
| Change in fair value of contingent consideration liability | - | - | 502 | - | |||||||||||||||
| Benefit from deferred income taxes | - | (15,182 | ) | - | (47,659 | ) | |||||||||||||
| Other, net | 184 | 232 | 608 | 1,606 | |||||||||||||||
| Changes in assets and liabilities, excluding effect of acquisitions: | |||||||||||||||||||
| Accounts receivable | (1,641 | ) | (6,477 | ) | (79 | ) | (6,480 | ) | |||||||||||
| Prepaid expenses and other current assets | 754 | 7,979 | (1,552 | ) | (4,607 | ) | |||||||||||||
| Other assets | 239 | 835 | 1,188 | 991 | |||||||||||||||
| Accounts payable | 2,182 | (1,040 | ) | 4,705 | 10,154 | ||||||||||||||
| Accrued liabilities | 3,834 | (1,458 | ) | 4,176 | 36,586 | ||||||||||||||
| Deferred revenue | (653 | ) | 15,383 | 25,420 | 75,135 | ||||||||||||||
| Other long-term liabilities | 1,483 | 1,343 | 4,943 | 3,316 | |||||||||||||||
| Net cash provided by operating activities (1) | 20,096 | 90,475 | 84,090 | 283,260 | |||||||||||||||
| Cash flows from investing activities | |||||||||||||||||||
| Purchases of marketable securities | (4,036 | ) | - | (35,609 | ) | - | |||||||||||||
| Proceeds from sale or disposal or maturity of marketable securities | 18,750 | 10,500 | 50,000 | 41,603 | |||||||||||||||
| Purchases of property and equipment | (3,817 | ) | (13,518 | ) | (12,629 | ) | (23,322 | ) | |||||||||||
| Intangible asset additions | (322 | ) | (8,184 | ) | (1,037 | ) | (21,893 | ) | |||||||||||
| Acquisition of businesses, net of cash acquired | - | (43,375 | ) | (61 | ) | (19,160 | ) | ||||||||||||
| Decrease (increase) in restricted cash and deposits | 1 | 1 | (30 | ) | 1,751 | ||||||||||||||
| Net cash provided by (used in) investing activities | 10,576 | (54,576 | ) | 634 | (21,021 | ) | |||||||||||||
| Cash flows from financing activities | |||||||||||||||||||
| Repayments of borrowings under credit facility | (7,500 | ) | - | (22,500 | ) | (30,000 | ) | ||||||||||||
| Proceeds from issuance of common stock upon option exercises | 4,039 | 1,009 | 9,443 | 6,363 | |||||||||||||||
| Payments of withholding taxes in connection with restricted stock unit vesting | (4,815 | ) | (2,734 | ) | (13,432 | ) | (32,189 | ) | |||||||||||
| Payment of debt issuance costs | - | - | (349 | ) | (1,993 | ) | |||||||||||||
| Payment of contingent consideration | (29 | ) | - | (29 | ) | - | |||||||||||||
| Dividends paid on common stock | (12,700 | ) | (13,181 | ) | (12,700 | ) | (39,117 | ) | |||||||||||
| Purchase of treasury stock | (3,462 | ) | (21,460 | ) | (22,799 | ) | (51,075 | ) | |||||||||||
| Net cash used in financing activities | (24,467 | ) | (36,366 | ) | (62,366 | ) | (148,011 | ) | |||||||||||
| Effect of exchange rate changes on cash and cash equivalents | 513 | 1,511 | 1,099 | 7,067 | |||||||||||||||
| Net increase in cash and cash equivalents | 6,718 | 1,044 | 23,457 | 121,295 | |||||||||||||||
| Cash and cash equivalents, beginning of period | 139,882 | 261,007 | 123,143 | 140,756 | |||||||||||||||
| Cash and cash equivalents, end of period | $ | 146,600 | $ | 262,051 | $ | 146,600 | $ | 262,051 | |||||||||||
| (1) | Cash flows from operating activities includes the following acquisition and litigation-related payments: | ||||||||||||||||||
| (a) Cash flows from operating activities includes acquisition transaction, transition, and integration-related payments of $1.7 million and $11.8 million for the three months ended September 30, 2016 and 2017, respectively and $1.8 million and $44.6 million for the nine months ended September 30, 2016 and 2017, respectively. | |||||||||||||||||||
| (b) Cash flows from operating activities includes acquisition-related retention-based bonus payments of $1.5 million and $6.0 million for the three and nine months ended September 30, 2016, respectively related to the Company's 2014 acquisitions. | |||||||||||||||||||
| (c) Cash flows from operating activities includes litigation-related payments of $0.3 million for the three months ended September 30, 2017 and $0.1 million and $0.6 million for the nine months ended September 30, 2016 and 2017, respectively. | |||||||||||||||||||
| Adjusted cash flows from operations adds back the items in (a), (b) and (c) above and sums to $23.2 million and $102.5 million for the three months ended September 30, 2016 and 2017, respectively, and $92.0 million and $328.4 million for the nine months ended September 30, 2016 and 2017, respectively. | |||||||||||||||||||