MiX Telematics Reports Third Quarter Fiscal Year 2023 U.S. GAAP Financial Results
By Automotive Editor
Third Quarter Highlights:
- Total revenue of $37.8 million, up 14% year-over-year (constant currency)
- Subscription revenue of $32.5 million, up 17% year-over-year (constant currency)
- Annual recurring revenue (“ARR”) of $131.8 million, up 17% year-over-year (constant currency)
- Record net quarterly organic subscriber additions of 44,600, bringing the total base to over 959,000
- Net income of $2.8 million, up from $0.6 million in the prior year
- Adjusted EBITDA of $8.4 million, at an Adjusted EBITDA margin of 22.2% (up from $6.0 million, at an Adjusted EBITDA margin of 17.0%, in the prior quarter)
- Net cash from operating activities of $11.2 million
- Free cash flow of $5.9 million
MIDRAND, South Africa & BOCA RATON, Fla.–(BUSINESS WIRE)–MiX Telematics Limited (“MiX Telematics” or the “Company”) (NYSE: MIXT, JSE: MIX), a leading global Software-as-a-Service (“SaaS”) provider of connected fleet management solutions, today announced financial results, in accordance with accounting principles generally accepted in the United States (“GAAP”), for the third quarter of fiscal year 2023, which ended December 31, 2022.
Management Commentary
“As we anticipated on our 2nd quarter earnings call, our 3rd quarter results are highlighted by record organic subscriber growth, a 520bp improvement in our adjusted EBITDA margin and a return to positive free cash flow generation,” said CEO Stefan Joselowitz. “Overall, I’m proud of our organization’s ability to capitalize on opportunities as we continue to see increased adoption of telematic solutions to improve driver safety and reduce risk.
“Heading into the 4th quarter of the fiscal year, we expect to see continued improvement in our operating margins while maintaining our balanced approach to growth and profitability. Our ability to generate free cash flow and margins that are in-line with our fiscal year-end target range is encouraging as we work to unlock full profitability potential.”
Financial Results for the Three Months Ended December 31, 2022
Subscription Revenue: Subscription revenue increased to $32.5 million, compared to $30.3 million for the third quarter of fiscal year 2022. The FSM business acquired on September 2, 2022 contributed $2.3 million to the subscription revenue for the third quarter of fiscal year 2023. Subscription revenue increased by 16.7% on a constant currency basis, year over year, of which 8.5% is attributable to the FSM business acquisition. During the third quarter of fiscal year 2023, the Company’s subscriber base increased by a net 44,600 subscribers, mainly due to the Africa segment, with contributions across all solution categories. Subscription revenue represented 85.9% of total revenue during the third quarter of fiscal year 2023.
The majority of the Company’s total revenue and subscription revenue are derived from currencies other than the U.S. Dollar. Accordingly, the strengthening of the U.S. Dollar against these currencies (in particular against the South African Rand) following continued currency volatility, has negatively impacted the Company’s revenue and subscription revenue reported in U.S. Dollars. Compared to the third quarter of fiscal year 2022, the South African Rand weakened by 14% against the U.S. Dollar. The Rand/U.S. Dollar exchange rate averaged R17.64 in the third quarter of fiscal year 2023 compared to an average of R15.42 during the third quarter of fiscal year 2022. The impact of translating foreign currencies to U.S. Dollars at the average exchange rates during the third quarter of fiscal year 2023 led to a 9.6% decrease in reported U.S. Dollar subscription revenue.
Total Revenue: Total revenue increased to $37.8 million, compared to $36.2 million for the third quarter of fiscal year 2022. Total revenue increased by 13.8% on a constant currency basis, year over year. Hardware and other revenue was $5.3 million, a decrease of 9.4%, compared to $5.9 million for the third quarter of fiscal year 2022. Hardware and other revenue decreased by 1.1% on a constant currency basis, year over year.
The impact of translating foreign currencies to U.S. Dollars at the average exchange rates during the third quarter of fiscal year 2023 led to a 9.4% decrease in reported U.S. Dollar total revenue.
Gross Margin: Gross profit increased to $24.3 million, compared to $22.5 million for the third quarter of fiscal year 2022. Gross profit margin increased 240 basis points to 64.4%, compared to 62.0% for the third quarter of fiscal year 2022. The subscription revenue margin during the third quarter of fiscal year 2023 was 69.6%, compared to 70.8% for the third quarter of fiscal year 2022.
Income From Operations: Income from operations increased to $4.0 million, compared to $2.6 million for the third quarter of fiscal year 2022. Operating income margin increased 353 basis points to 10.7%, compared to 7.1% for the third quarter of fiscal year 2022. Operating expenses of $20.3 million increased by $0.4 million, or 2.3%, compared to the second quarter of fiscal year 2022. The increase in operating expenses was mainly due to a $0.6 million increase in sales and marketing investments. It should be noted that the FSM business contributed $1.1 million of the total operating expenses for the third quarter of fiscal year 2023.
Net Income and Earnings Per Share: Net income increased to $2.8 million, compared to net income of $0.6 million in the third quarter of fiscal year 2022. During the third quarter of fiscal year 2023, net income included a net foreign exchange loss of $0.8 million before tax and a $1.3 million credit from the income tax effect of net foreign exchange losses (which includes a $1.1 million deferred tax credit on a U.S. Dollar intercompany loan between MiX Telematics and MiX Telematics Investments Proprietary Limited (“MiX Investments”), a wholly-owned subsidiary of the Company, as well as a $0.2 million deferred tax credit on other foreign exchange losses). During the third quarter of fiscal year 2022, net income included a net foreign exchange gain of $0.1 million before tax and a $1.1 million charge from the income tax effect of net foreign exchange gains, which relates to the deferred tax charge on a U.S. Dollar intercompany loan between MiX Telematics and MiX Investments.
Earnings per diluted ordinary share increased to 0.5 U.S. cents, compared to 0.1 U.S. cents in the third quarter of fiscal year 2022. For the third quarter of fiscal year 2023, the calculation was based on diluted weighted average ordinary shares in issue of 555.8 million compared to 564.6 million diluted weighted average ordinary shares in issue during the third quarter of fiscal year 2022. On a ratio of 25 ordinary shares to one American Depositary Share (“ADS”), earnings per diluted ADS increased to 13 U.S. cents compared to 3 U.S. cents in the third quarter of fiscal year 2022.
Adjusted Effective Tax Rate: The Company’s effective tax rate was 7.4%, compared to 76.0% in the third quarter of fiscal year 2022. Adjusted effective tax rate, a non-GAAP measure which excludes the impact of net foreign exchange gains and losses net of tax and acquisition-related costs, is the tax rate used in determining adjusted net income below. Adjusted effective tax rate was 39.6% compared to 35.5% in the third quarter of fiscal year 2022.
Adjusted EBITDA: Adjusted EBITDA, a non-GAAP measure, increased to $8.4 million, compared to $7.1 million for the third quarter of fiscal year 2022. Adjusted EBITDA margin, a non-GAAP measure, for the third quarter of fiscal year 2023 increased 260 basis points to 22.2%, compared to 19.6% for the third quarter of fiscal year 2022.
Adjusted Net Income and Adjusted Net Income Per Share: Adjusted net income increased to $2.3 million, compared to $1.6 million for the third quarter of fiscal year 2022. Adjusted net income per diluted ordinary share increased to 0.4 U.S. cents, compared to 0.3 U.S. cents in the third quarter of fiscal year 2022. At a ratio of 25 ordinary shares to one ADS, the adjusted net income per diluted ADS increased to 10 U.S. cents compared to 7 U.S. cents in the third quarter of fiscal year 2022.
Cash and Cash Equivalents and Cash Flow: At December 31, 2022, the Company had $25.0 million of cash and cash equivalents, compared to $33.7 million at March 31, 2022.
Net cash provided by operating activities for the third quarter of fiscal year 2023 increased to $11.2 million compared to $4.0 million net cash provided by operating activities for the third quarter of fiscal year 2022. The Company invested $5.3 million in capital expenditures (including investments in in-vehicle devices of $3.9 million), leading to free cash flow, a non-GAAP measure, of $5.9 million in the quarter. The Company generated negative free cash flow of $1.5 million for the third quarter of fiscal year 2022 when the Company invested $5.5 million in capital expenditures (including investments in in-vehicle devices of $3.7 million).
Net cash used in investing activities for the third quarter of fiscal year 2023 was $5.3 million, compared to $5.5 million net cash used in investing activities for the third quarter of fiscal year 2022.
Net cash used in financing activities amounted to $1.1 million for the third quarter of fiscal year 2023, compared to $2.0 million used during the third quarter of fiscal year 2022. The cash used in financing activities during the third quarter of fiscal year 2023 mainly consisted of short-term debt facilities utilized of $0.2 million, offset by dividends paid of $1.2 million. The cash used in financing activities during the third quarter of fiscal year 2022 consisted of ordinary shares repurchased of $0.8 million and dividends paid of $1.4 million, offset by facilities utilized of $0.2 million.
During the quarter, the South African Rand strengthened against the U.S. Dollar from R17.98 at September 30, 2022 to R16.98 at December 31, 2022 and as a result, cash increased by $0.6 million due to foreign exchange gains.
Quarterly Dividend
The last dividend payment of 4 South African cents (0.2 U.S. cents) per ordinary share and 1 South African Rand (6 U.S. cents) per ADS was paid on December 1, 2022 to ADS holders on record on November 18, 2022. A dividend of 4 South African cents per ordinary share and 1 South African Rand per ADS will be paid on March 2, 2023 to ADS holders on record as of the close of business on February 17, 2023.
The details with respect to the dividends declared for holders of our ADSs are as follows:
Ex dividend on New York Stock Exchange (NYSE) |
Thursday, February 16, 2023 |
Record date |
Friday, February 17, 2023 |
Approximate date of currency conversion |
Monday, February 20, 2023 |
Approximate dividend payment date |
Thursday, March 2, 2023 |
Share Repurchases
No shares were repurchased during the three months ended December 31, 2022.
Conference Call Information
MiX Telematics management will host a conference call and audio webcast at 8:00 a.m. (Eastern Daylight Time) and 3:00 p.m. (South African Time) on Thursday, January 26, 2023 to discuss the Company’s financial results and current business outlook.
- The live webcast of the call will be available at the “Investor Information” page of the Company’s website, http://investor.mixtelematics.com.
- To access the call, dial 1-877-451-6152 (within the United States) or 0-800-983-831 (within South Africa) or 1-201-389-0879 (outside of the United States). The conference ID is 13735507.
- A replay of this conference call will be available for a limited time at 1-844-512-2921 (within the United States) or 1-412-317-6671 (within South Africa or outside of the United States). The replay conference ID is 13735507.
- A replay of the webcast will also be available for a limited time at http://investor.mixtelematics.com.
About MiX Telematics Limited
MiX Telematics is a leading global provider of connected fleet and mobile asset solutions delivered as SaaS to over 959,000 subscribers in over 120 countries. The Company’s products and services provide enterprise fleets, small fleets and consumers with solutions for efficiency, safety, compliance and security. MiX Telematics was founded in 1996 and has offices in South Africa, the United Kingdom, the United States, Uganda, Brazil, Australia, Romania and the United Arab Emirates as well as a network of more than 130 fleet value-added resellers worldwide. MiX Telematics shares are publicly traded on the Johannesburg Stock Exchange (JSE: MIX) and MiX Telematics American Depositary Shares are listed on the New York Stock Exchange (NYSE: MIXT). For more information, visit www.mixtelematics.com.
Forward-Looking Statements
This press release includes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including without limitation, statements regarding our position to execute on our growth strategy, and our ability to expand our leadership position. These forward-looking statements include, but are not limited to, the Company’s beliefs, plans, goals, objectives, expectations, assumptions, estimates, intentions, future performance, other statements that are not historical facts and statements identified by words such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “seeks”, “estimates” or words of similar meaning. These forward-looking statements reflect our current views about our plans, intentions, expectations, strategies and prospects, which are based on the information currently available to us and on assumptions we have made. Although we believe that our plans, intentions, expectations, strategies and prospects as reflected in, or suggested by, these forward-looking statements are reasonable, we can give no assurance that the plans, intentions, expectations or strategies will be attained or achieved.
Furthermore, actual results may differ materially from those described in the forward-looking statements and will be affected by a variety of known and unknown risks and uncertainties, some of which are beyond our control including, without limitation:
- our ability to attract, sell to and retain customers;
- our ability to improve our growth strategies successfully, including our ability to increase sales to existing customers;
- our ability to adapt to rapid technological change in our industry and the use of artificial intelligence;
- competition from industry consolidation and new entrants into the industry;
- loss of key personnel or our failure to attract, train and retain other highly qualified personnel;
- our ability to integrate any businesses we acquire;
- the introduction of new solutions and international expansion;
- the impact of the global component shortage and supply chain disruptions;
- the ongoing effects and economic impact of COVID-19 or any other pandemic on our business, results of operations and financial conditions as well as the impact on our customer’s ability to meet their financial obligations, are highly uncertain and difficult to predict;
- our dependence on key suppliers and vendors to manufacture our hardware;
- our dependence on our network of dealers and distributors to sell our solutions;
- our ability to navigate and adapt in adverse global economic and market conditions;
- businesses may not continue to adopt fleet management solutions;
- our future business and system development, results of operations and financial condition;
- expected changes in our profitability and certain cost or expense items as a percentage of our revenue;
- changes in the practices of insurance companies;
- the impact of laws and regulations relating to the Internet and data privacy;
- our ability to ensure compliance with export laws, customs and import regulations, economic sanctions and Export Administration Regulations;
- our ability to protect our intellectual property and proprietary technologies and address any infringement claims;
- our ability to defend ourselves from litigation or administrative proceedings relating to labor, regulatory, tax or similar issues;
- significant disruption in service on, or security breaches of, our websites or computer systems;
- our dependence on third-party technology;
- fluctuations in the value of the South African Rand;
- economic, social, political, labor and other conditions and developments in South Africa and globally;
- our ability to issue securities and access the capital markets in the future; and
- other risks set forth in our filings with the U.S. Securities Exchange Commission.
We assume no obligation to update any forward-looking statements contained in this press release and expressly disclaim any obligation to do so, whether as a result of new information, future events or otherwise, except as required by law.
Use of Non-GAAP Financial Measures
This press release and the accompanying tables include references to adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted net income per share, adjusted effective tax rate, free cash flow and constant currency, which are non-GAAP financial measures. For a description of these non-GAAP financial measures, including the reasons management uses these measures, please see Annexure A titled “Non-GAAP Financial Measures and Key Business Metrics”. A reconciliation of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with GAAP is provided in Annexure A.
MIX TELEMATICS LIMITED CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share amounts) (Unaudited) |
||||||||
|
|
March 31, |
|
December 31, |
||||
ASSETS |
|
|
|
|
||||
Current assets: |
|
|
|
|
||||
Cash and cash equivalents |
|
$ |
33,738 |
|
|
$ |
24,968 |
|
Restricted cash |
|
|
981 |
|
|
|
841 |
|
Accounts receivables, net |
|
|
25,092 |
|
|
|
27,068 |
|
Inventory, net |
|
|
3,356 |
|
|
|
4,995 |
|
Prepaid expenses and other current assets |
|
|
11,463 |
|
|
|
10,065 |
|
Total current assets |
|
|
74,630 |
|
|
|
67,937 |
|
Property, plant and equipment, net |
|
|
32,274 |
|
|
|
36,944 |
|
Goodwill |
|
|
44,434 |
|
|
|
40,552 |
|
Intangible assets, net |
|
|
20,460 |
|
|
|
23,530 |
|
Deferred tax assets |
|
|
3,768 |
|
|
|
2,365 |
|
Other assets |
|
|
4,988 |
|
|
|
6,395 |
|
Total assets |
|
$ |
180,554 |
|
|
$ |
177,723 |
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
||||
Current liabilities: |
|
|
|
|
||||
Short-term debt |
|
$ |
5,597 |
|
|
$ |
12,633 |
|
Accounts payables |
|
|
8,052 |
|
|
|
3,609 |
|
Accrued expenses and other liabilities |
|
|
19,610 |
|
|
|
23,498 |
|
Contingent consideration |
|
|
— |
|
|
|
3,792 |
|
Deferred revenue |
|
|
6,692 |
|
|
|
6,607 |
|
Income taxes payable |
|
|
590 |
|
|
|
894 |
|
Total current liabilities |
|
|
40,541 |
|
|
|
51,033 |
|
Deferred tax liabilities |
|
|
8,972 |
|
|
|
10,846 |
|
Contingent consideration |
|
|
— |
|
|
|
281 |
|
Long-term accrued expenses and other liabilities |
|
|
4,344 |
|
|
|
3,794 |
|
Total liabilities |
|
|
53,857 |
|
|
|
65,954 |
|
|
|
|
|
|
||||
Stockholders’ equity: |
|
|
|
|
||||
MiX Telematics Limited stockholders’ equity |
|
|
|
|
||||
Preference shares: 100 million shares authorized but not issued |
|
|
— |
|
|
|
— |
|
Ordinary shares: 605.2 million and 607.1 million no-par value shares issued and outstanding as of March 31, 2022 and December 31, 2022, respectively |
|
|
64,390 |
|
|
|
64,283 |
|
Less treasury stock at cost: 53.8 million shares as of March 31, 2022 and December 31, 2022 |
|
|
(17,315 |
) |
|
|
(17,315 |
) |
Retained earnings |
|
|
79,709 |
|
|
|
78,007 |
|
Accumulated other comprehensive income/(loss) |
|
|
3,909 |
|
|
|
(9,534 |
) |
Additional paid-in capital |
|
|
(4,001 |
) |
|
|
(3,677 |
) |
Total MiX Telematics Limited stockholders’ equity |
|
|
126,692 |
|
|
|
111,764 |
|
Non-controlling interest |
|
|
5 |
|
|
|
5 |
|
Total stockholders’ equity |
|
|
126,697 |
|
|
|
111,769 |
|
|
|
|
|
|
||||
Total liabilities and stockholders’ equity |
|
$ |
180,554 |
|
|
$ |
177,723 |
|
MIX TELEMATICS LIMITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share data) (Unaudited) |
||||||||||||
|
Three Months Ended December 31, |
|
Nine Months Ended December 31, |
|||||||||
|
|
2021 |
|
|
2022 |
|
|
|
2021 |
|
|
2022 |
Revenue |
|
|
|
|
|
|
|
|||||
Subscription |
$ |
30,324 |
|
$ |
32,469 |
|
|
$ |
92,299 |
|
$ |
94,132 |
Hardware and other |
|
5,889 |
|
|
5,338 |
|
|
|
14,886 |
|
|
13,996 |
Total revenue |
|
36,213 |
|
|
37,807 |
|
|
|
107,185 |
|
|
108,128 |
Cost of revenue |
|
|
|
|
|
|
|
|||||
Subscription |
|
8,869 |
|
|
9,864 |
|
|
|
27,215 |
|
|
29,769 |
Hardware and other |
|
4,893 |
|
|
3,595 |
|
|
|
11,696 |
|
|
10,176 |
Total cost of revenue |
|
13,762 |
|
|
13,459 |
|
|
|
38,911 |
|
|
39,945 |
Gross profit |
|
22,451 |
|
|
24,348 |
|
|
|
68,274 |
|
|
68,183 |
Operating expenses |
|
|
|
|
|
|
|
|||||
Sales and marketing |
|
4,027 |
|
|
4,589 |
|
|
|
11,411 |
|
|
12,974 |
Administration and other |
|
15,841 |
|
|
15,728 |
|
|
|
46,214 |
|
|
47,275 |
Total operating expenses |
|
19,868 |
|
|
20,317 |
|
|
|
57,625 |
|
|
60,249 |
Income from operations |
|
2,583 |
|
|
4,031 |
|
|
|
10,649 |
|
|
7,934 |
Other income/(expense) |
|
114 |
|
|
(748 |
) |
|
|
178 |
|
|
859 |
Net interest expense |
|
75 |
|
|
272 |
|
|
|
294 |
|
|
8 |
Income before income tax expense |
|
2,622 |
|
|
3,011 |
|
|
|
10,533 |
|
|
8,785 |
Income tax expense |
|
1,992 |
|
|
223 |
|
|
|
5,073 |
|
|
6,525 |
Net income |
|
630 |
|
|
2,788 |
|
|
|
5,460 |
|
|
2,260 |
Less: Net income attributable to non-controlling interest |
|
— |
|
|
— |
|
|
|
— |
|
|
— |
Net income attributable to MiX Telematics Limited |
$ |
630 |
|
$ |
2,788 |
|
|
$ |
5,460 |
|
$ |
2,260 |
|
|
|
|
|
|
|
|
|||||
Net income per ordinary share |
|
|
|
|
|
|
|
|||||
Basic |
$ |
0.001 |
|
$ |
0.005 |
|
|
$ |
0.010 |
|
$ |
0.004 |
Diluted |
$ |
0.001 |
|
$ |
0.005 |
|
|
$ |
0.010 |
|
$ |
0.004 |
|
|
|
|
|
|
|
|
|||||
Net income per American Depositary Share |
|
|
|
|
|
|
|
|||||
Basic |
$ |
0.03 |
|
$ |
0.13 |
|
|
$ |
0.25 |
|
$ |
0.10 |
Diluted |
$ |
0.03 |
|
$ |
0.13 |
|
|
$ |
0.24 |
|
$ |
0.10 |
|
|
|
|
|
|
|
|
|||||
Ordinary shares |
|
|
|
|
|
|
|
|||||
Weighted average |
|
552,452 |
|
|
552,865 |
|
|
|
552,234 |
|
|
552,148 |
Diluted weighted average |
|
564,580 |
|
|
555,811 |
|
|
|
565,076 |
|
|
556,047 |
|
|
|
|
|
|
|
|
|||||
American Depositary Shares |
|
|
|
|
|
|
|
|||||
Weighted average |
|
22,098 |
|
|
22,115 |
|
|
|
22,089 |
|
|
22,086 |
Diluted weighted average |
|
22,583 |
|
|
22,232 |
|
|
|
22,603 |
|
|
22,242 |
|
MIX TELEMATICS LIMITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) |
||||||||
|
|
Nine Months Ended December 31, |
||||||
|
|
2021 |
|
2022 |
||||
Cash flows from operating activities: |
|
|
|
|
||||
Cash generated from operations |
|
$ |
18,621 |
|
|
$ |
13,551 |
|
Interest received |
|
|
300 |
|
|
|
590 |
|
Interest paid |
|
(262 |
) |
|
|
(601 |
) |
|
Income tax paid |
|
|
(3,999 |
) |
|
|
(745 |
) |
Net cash provided by operating activities |
|
|
14,660 |
|
|
|
12,795 |
|
|
|
|
|
|
||||
Cash flows from investing activities: |
|
|
|
|
||||
Acquisition of property, plant and equipment – in-vehicle devices |
|
|
(13,413 |
) |
|
|
(14,521 |
) |
Acquisition of property, plant and equipment – other |
|
|
(1,462 |
) |
|
|
(788 |
) |
Proceeds from the sale of property, plant and equipment |
|
|
54 |
|
|
|
71 |
|
Acquisition of intangible assets |
|
|
(4,083 |
) |
|
|
(4,086 |
) |
Cash paid for business combination |
|
|
— |
|
|
|
(3,739 |
) |
Net cash used in investing activities |
|
|
(18,904 |
) |
|
|
(23,063 |
) |
|
|
|
|
|
||||
Cash flows from financing activities: |
|
|
|
|
||||
Cash paid for ordinary shares repurchased |
|
|
(801 |
) |
|
|
(107 |
) |
Cash paid on dividends to MiX Telematics Limited stockholders |
|
|
(4,484 |
) |
|
|
(3,955 |
) |
Movement in short-term debt |
|
|
666 |
|
|
|
7,562 |
|
Net cash (used in)/from financing activities |
|
|
(4,619 |
) |
|
|
3,500 |
|
|
|
|
|
|
||||
Net decrease in cash and cash equivalents, and restricted cash |
|
|
(8,863 |
) |
|
|
(6,768 |
) |
Cash and cash equivalents, and restricted cash at beginning of the period |
|
|
46,343 |
|
|
|
34,719 |
|
Effect of exchange rate changes on cash and cash equivalents, and restricted cash |
|
|
(782 |
) |
|
|
(2,142 |
) |
Cash and cash equivalents, and restricted cash at end of the period |
|
$ |
36,698 |
|
|
$ |
25,809 |
|
Segment Information
Our operating segments are based on the geographical location of our Regional Sales Offices (“RSOs”) and also include our Central Services Organization (“CSO”). CSO is our central services organization that wholesales our products and services to our RSOs who, in turn, interface with our end-customers, distributors and dealers. CSO is also responsible for the development of our hardware and software platforms and provides common marketing, product management, technical and distribution support to each of our other operating segments.
Each RSO’s results reflect the external revenue earned, as well as its performance before the remaining CSO and corporate costs allocations. Segment performance is measured and evaluated by the chief operating decision maker (“CODM”) using Segment Adjusted EBITDA, which is a measure that uses income before income tax expense excluding acquisition-related costs, non-recurring legal costs, net interest expense, net foreign exchange gains/losses, net loss/profit on sale of property, plant and equipment, restructuring costs, stock-based compensation costs, impairment of long-lived assets, depreciation, amortization, operating lease costs and corporate and consolidation entries.
Contacts
Investor Relations Contact
Matt Glover and Cody Cree
Gateway Group, Inc.
MIXT@gatewayir.com
+1-949-574-3860