LONDON, Jan. 22,
2024 /PRNewswire/ -- Clarivate Plc (NYSE: CLVT)
(the "Company" or "Clarivate"), a global leader in connecting
people and organizations to intelligence they can trust to
transform their world, announced today the launch of a process to
refinance the Company's 2026 Term Loan B credit facility that would
extend the maturity to 2031 for a new combined term loan amount of
$2.2 billion.
"We are proactively capitalizing on the favorable debt market
environment in order to provide further flexibility within our
capital structure," said Jonathan
Collins, Executive Vice President and Chief Financial
Officer. "With our strong free cash flow, we continue to focus on
investing for growth and reducing our debt to drive long-term
shareholder value."
The Company also announced that it expects to record a non-cash
goodwill impairment charge in the range of approximately
$800 million to $900 million in the fourth quarter 2023, across
the Intellectual Property and Life Sciences & Healthcare
segments. The charge is expected to lower the Company's 2023
forecast of a GAAP net loss but will have no impact on the 2023
full year outlook for Revenues, Organic Revenue Growth, Adjusted
EBITDA, Adjusted EBITDA Margin, Adjusted Diluted EPS and Free Cash
Flow as outlined in its third quarter 2023 earnings press release
issued on November 7, 2023.
Terms of the potential refinancing will be disclosed upon the
completion of the transaction. The proposed refinancing is subject
to market and other conditions, and there can be no assurance that
it will be completed on favorable terms or at all.
About Clarivate
Clarivate™ is a leading global
information services provider. We connect people and organizations
to intelligence they can trust to transform their perspective,
their work and our world. Our subscription and technology-based
solutions are coupled with deep domain expertise and cover the
areas of Academia & Government, Intellectual Property and Life
Sciences & Healthcare. For more information, please visit
clarivate.com.
Use of Non-GAAP Financial Measures
Non-GAAP results are not presentations made in accordance with
U.S. generally accepted accounting principles ("GAAP") and are
presented only as a supplement to our financial statements based on
GAAP. Non-GAAP financial information is provided to enhance the
reader's understanding of our financial performance, but none of
these non-GAAP financial measures are recognized terms under GAAP.
They 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 GAAP or operating cash
flows determined in accordance with GAAP. As a result, you should
not consider such measures in isolation from, or as a substitute
for, financial measures or results of operations calculated or
determined in accordance with GAAP.
We use non-GAAP measures in our operational and financial
decision-making. We believe that such measures allow us to focus on
what we deem to be a more reliable indicator of ongoing operating
performance and our ability to generate cash flow from operations,
and we also believe that investors may find these non-GAAP
financial measures useful for the same reasons. Non-GAAP measures
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 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 GAAP financial
disclosures. However, non-GAAP measures have limitations as
analytical tools and because not all companies use identical
calculations, our presentation of non-GAAP financial measures may
not be comparable to other similarly titled measures of other
companies.
Definitions and reconciliations of non-GAAP measures, such as
Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income,
Adjusted Diluted EPS, Free Cash Flow and Standalone Adjusted EBITDA
to the most directly comparable GAAP measures are provided within
the schedules attached to this release. Our presentation of
non-GAAP measures should not be construed as an inference that our
future results will be unaffected by any of the adjusted items, or
that any projections and estimates will be realized in their
entirety or at all.
Forward-Looking Statements
This communication contains "forward-looking statements" as
defined in the Private Securities Litigation Reform Act of 1995.
These statements, which express management's current views
concerning future business, events, trends, contingencies,
financial performance, or financial condition, appear at various
places in this communication and may use words like "aim,"
"anticipate," "assume," "believe," "continue," "could," "estimate,"
"expect," "forecast," "future," "goal," "intend," "likely," "may,"
"might," "plan," "potential," "predict," "project," "see," "seek,"
"should," "strategy," "strive," "target," "will," and "would" and
similar expressions, and variations or negatives of these words.
Examples of forward-looking statements include, among others,
statements we make regarding: guidance outlook and predictions
relating to expected operating results, such as revenue growth and
earnings; strategic actions such as acquisitions, joint ventures,
and dispositions, including the anticipated benefits therefrom, and
our success in integrating acquired businesses; anticipated levels
of capital expenditures in future periods; our ability to
successfully realize cost savings initiatives and transition
services expenses; our belief that we have sufficient liquidity to
fund our ongoing business operations; expectations of the effect on
our financial condition of claims, litigation, environmental costs,
the impact of inflation, the impact of foreign currency
fluctuations, the COVID-19 pandemic and governmental responses
thereto, international hostilities, contingent liabilities, and
governmental and regulatory investigations and proceedings; and our
strategy for customer retention, growth, product development,
market position, financial results, and reserves. Forward-looking
statements are neither historical facts nor assurances of future
performance. Instead, they are based only on management's current
beliefs, expectations, and assumptions regarding the future of our
business, future plans and strategies, projections, anticipated
events and trends, the economy, and other future conditions.
Because forward-looking statements relate to the future, they are
difficult to predict and many of which are outside of our control.
Important factors that could cause our actual results and financial
condition to differ materially from those indicated in the
forward-looking statements include those factors discussed under
the caption "Risk Factors" in our annual report on Form 10-K/A,
along with our other filings with the U.S. Securities and Exchange
Commission ("SEC"). However, those factors should not be considered
to be a complete statement of all potential risks and
uncertainties. Additional risks and uncertainties not known to us
or that we currently deem immaterial may also impair our business
operations. Forward-looking statements are based only on
information currently available to our management and speak only as
of the date of this communication. We do not assume any obligation
to publicly provide revisions or updates to any forward-looking
statements, whether as a result of new information, future
developments or otherwise, should circumstances change, except as
otherwise required by securities and other applicable laws. Please
consult our public filings with the SEC or on our website at
www.clarivate.com.
The following table
presents our calculation of Adjusted EBITDA and Adjusted EBITDA
Margin for the 2023 outlook and reconciles these measures to our
Net loss for the same period:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AS PRESENTED -
Q3'23
|
|
UPDATED FOR
EXPECTED
IMPAIRMENT
|
|
CHANGE
|
|
|
Year Ending
December 31, 2023
(Forecasted)
|
|
Year Ending
December 31, 2023
(Forecasted)
|
|
Year Ending
December 31, 2023
(Forecasted)
|
|
(in millions, except
percentages)
|
Low
|
|
High
|
|
Low
|
|
High
|
|
Low
|
|
High
|
|
Net loss attributable to ordinary
shares
|
$(182)
|
|
$(132)
|
|
$(1,082)
|
|
$(932)
|
|
$(900)
|
|
$(800)
|
|
Dividends on preferred
shares(1)
|
75
|
|
75
|
|
75
|
|
75
|
|
-
|
|
-
|
|
Net loss
|
$(107)
|
|
$(57)
|
|
$(1,007)
|
|
$(857)
|
|
$(900)
|
|
$(800)
|
|
(Benefit) provision
for income taxes
|
(63)
|
|
(63)
|
|
(63)
|
|
(63)
|
|
-
|
|
-
|
|
Depreciation and
amortization
|
707
|
|
707
|
|
707
|
|
707
|
|
-
|
|
-
|
|
Interest expense,
net
|
292
|
|
292
|
|
292
|
|
292
|
|
-
|
|
-
|
|
Restructuring and
lease impairments(2)
|
30
|
|
30
|
|
30
|
|
30
|
|
-
|
|
-
|
|
Goodwill and
intangible asset impairments(3)
|
135
|
|
135
|
|
1,035
|
|
935
|
|
900
|
|
800
|
|
Transaction related
costs
|
5
|
|
5
|
|
5
|
|
5
|
|
-
|
|
-
|
|
Mark to market
adjustment on financial instruments
|
(14)
|
|
(14)
|
|
(14)
|
|
(14)
|
|
-
|
|
-
|
|
Share-based
compensation expense
|
130
|
|
130
|
|
130
|
|
130
|
|
-
|
|
-
|
|
Other(4)
|
(25)
|
|
(25)
|
|
(25)
|
|
(25)
|
|
-
|
|
-
|
|
Adjusted EBITDA
|
$1,090
|
|
$1,140
|
|
$1,090
|
|
$1,140
|
|
$0
|
|
$0
|
|
Adjusted EBITDA margin
|
42.0 %
|
|
42.5 %
|
|
42.0 %
|
|
42.5 %
|
|
0.0 %
|
|
0.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Dividends on our mandatory
convertible preferred shares ("MCPS") are payable quarterly at an
annual rate of 5.25% of the liquidation preference of $100 per
share. For the purposes of calculating net loss attributable to
Clarivate, we have excluded the accrued and anticipated MCPS
dividends.
|
|
(2) Reflects restructuring costs
expected to be incurred in 2023 associated with the ProQuest
acquisition and Segment Optimization restructuring
programs.
|
|
|
|
|
(3) Primarily represents goodwill
impairment related to the quantitative goodwill impairment
assessment performed over the Company's reporting units and
intangible assets impairment related to Assets
Held-for-Sale.
|
|
(4) Primarily includes the gain on legal
settlement partially offset by a net loss on foreign exchange
re-measurement.
|
|
|
|
|
|
|
|
Category: Debt
Source: Clarivate Plc
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SOURCE Clarivate Plc