Market Newsdesk

November 13, 2020 6:35 am

ORIC Pharmaceuticals Announces Pricing of Upsized Public Offering

SOUTH SAN FRANCISCO, Calif. and SAN DIEGO, Nov. 13, 2020 (GLOBE NEWSWIRE) — ORIC Pharmaceuticals, Inc. (Nasdaq: ORIC), a clinical stage oncology company focused on developing treatments that address mechanisms of therapeutic resistance, today announced the pricing of an upsized underwritten public offering of 5,040,000 shares of its common stock at a price of $23.00 per share. All of the shares of common stock are being offered by ORIC. In addition, ORIC has granted the underwriters a 30-day option to purchase up to 756,000 additional shares of common stock at the public offering price, less the underwriting discounts and commissions. The gross proceeds to ORIC from the offering, before deducting underwriting discounts and commissions and other offering expenses payable by ORIC, are expected to be approximately $115.9 million, excluding any exercise of the underwriters’ option to purchase additional shares. The offering is expected to close on November 17, 2020, subject to customary closing conditions.

J.P. Morgan Securities LLC, Citigroup, Jefferies LLC and Guggenheim Securities are acting as joint book-running managers for the offering. Oppenheimer & Co. Inc. is acting as lead manager for the proposed offering.

The offering is made only by means of a prospectus, copies of which may be obtained, when available, from: J.P. Morgan Securities LLC, Attention: Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, by telephone at (866) 803-9204 or by email at [email protected]; Citigroup Global Markets Inc., c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717 or by telephone at (800) 831-9146; Jefferies LLC, Attention: Equity Syndicate Prospectus Department, 520 Madison Avenue, 2nd Floor, New York, NY 10022, by telephone at (877) 821-7388 or by email at [email protected]; or Guggenheim Securities, LLC, Attention: Equity Syndicate Department, 330 Madison, 8th Floor, New York, NY 10017, by telephone at (212) 518-9658 or by email at [email protected].

Registration statements relating to the securities have been filed with the Securities and Exchange Commission and have become effective. This press release does not constitute an offer to sell or a solicitation of an offer to buy these securities, nor will there be any sale of these securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful before registration or qualification under the securities laws of that state or jurisdiction.

About ORIC Pharmaceuticals, Inc.

ORIC Pharmaceuticals is a clinical stage biopharmaceutical company dedicated to improving patients’ lives by Overcoming Resistance In Cancer. ORIC’s lead product candidate, ORIC-101, is a potent and selective small molecule antagonist of the glucocorticoid receptor, which has been linked to resistance to multiple classes of cancer therapeutics across a variety of solid tumors. ORIC-101 is currently in two separate Phase 1b trials of ORIC-101 in combination with (1) Xtandi (enzalutamide) in metastatic prostate cancer and (2) Abraxane (nab-paclitaxel) in advanced or metastatic solid tumors. ORIC’s other product candidates include (1) ORIC-533, an orally bioavailable small molecule inhibitor of CD73, a key node in the adenosine pathway believed to play a central role in resistance to chemotherapy- and immunotherapy-based treatment regimens, (2) ORIC-944, an allosteric inhibitor of the polycomb repressive complex 2 (PRC2) via the EED subunit, being developed for prostate cancer, and (3) ORIC-114, a brain penetrant inhibitor designed to selectively target EGFR and HER2 with high potency against exon 20 insertion mutations, being developed across multiple genetically defined cancers. Beyond these four product candidates, ORIC is also developing multiple precision medicines targeting other hallmark cancer resistance mechanisms. ORIC has offices in South San Francisco and San Diego, California.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements as that term is defined in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements in this press release that are not purely historical are forward-looking statements. Such forward-looking statements include, among other things, statements regarding the terms, timing and completion of the public offering of common stock. The forward-looking statements contained herein are based upon ORIC’s current expectations and involve assumptions that may never materialize or may prove to be incorrect. Actual results could differ materially from those projected in any forward-looking statements due to numerous risks and uncertainties, including but not limited to risks and uncertainties related to market conditions and satisfaction of customary closing conditions related to the offering, and other risks. Further information regarding such risks and uncertainties may be found in ORIC’s registration statement on Form S-1 filed with the Securities and Exchange Commission (SEC) on November 10, 2020 and the preliminary prospectus included therein, as well as other documents ORIC files from time to time with the SEC, including ORIC’s Quarterly Report on Form 10-Q filed with the SEC on November 5, 2020, and ORIC’s future reports to be filed with the SEC. These forward-looking statements are made as of the date of this press release, and ORIC assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements, except as required by law.

For more information, please contact:

Dominic Piscitelli, Chief Financial Officer
[email protected]
[email protected]

November 13, 2020 6:33 am

NTN Buzztime, Inc. Reports Third Quarter 2020 Results

PR Newswire

CARLSBAD, Calif., Nov. 13, 2020 /PRNewswire/ — NTN Buzztime, Inc. (NYSE American: NTN), reported financial results for the third quarter ended September 30, 2020.

“Buzztime is working diligently toward closing two transformative transactions,” said Allen Wolff, CEO of NTN Buzztime. “Under the terms of the previously announced asset purchase agreement with eGames.com Holdings, LLC, we plan to sell all our assets related to our game network to eGames.com. Our goal is to preserve our compelling in-venue experience that engages patrons for Buzztime customer venues and safeguard our large and loyal player and customer base while monetizing our assets. The asset sale will strengthening our balance sheet and improve our financial position for the previously announced proposed merger with Brooklyn Immunotherapeutics LLC, which is advancing clinical development of cytokine-based therapy to enable the immune system to attack certain types of cancer cells. We believe that the proposed merger will benefit both investors of Brooklyn and stockholders of NTN Buzztime. We expect both transactions to close simultaneously in early 2021, subject to Buzztime’s stockholders approving both proposed transactions, the beneficial holders of Brooklyn’s Class A membership units approving the proposed merger, and the satisfaction of other customary closing conditions.”

Financial Results
For the third quarter 2020, total revenues were $1.5 million, up $0.7 million (or 96%) sequentially as compared to the second quarter of 2020, but down from $4.6 million in the third quarter of 2019. The decrease reflects reduced site count, primarily as a result of the termination of our relationships with Buffalo Wild Wings corporate-owned restaurants and its franchisees in November 2019, and the impact of the COVID-19 pandemic on the company’s business, as a substantial number of the bars and restaurants that subscribe to the network suspended their subscriptions for at least a portion of the current year period. Third quarter 2020 operating expense decreased to $2.9 million, from $4.9 million in the third quarter of 2019, reflecting corporate restructuring and cost reductions. Third quarter 2020 net loss attributable to common shareholders was $1.5 million, or $0.50 per share, compared to $351,000, or $0.12 per share, in the prior year quarter.

Liquidity
Cash, cash equivalents and unrestricted cash was $1.7 million at September 30, 2020, compared to $3.2 million at December 31, 2019. In April 2020, the company received $1.6 million under the Paycheck Protection Program of the CARES Act. In November 2020, the Small Business Administration approved the company’s application to forgive $1.1 million of such loan, leaving a note balance of $0.5 million. Also, in September 2020, the company received a bridge loan of $1.0 million from an affiliate of eGames.com in connection with entering into the asset purchase agreement with eGames.com. Outstanding amounts under the bridge loan, if the asset sale closes, will be applied to the purchase price of the asset sale upon closing. At September 30, 2020, the principal balance of the term loan with Avidbank was $725,000, and the company had negative working capital of $137,000. For additional information regarding the company’s liquidity and capital resources, please see the quarterly report on Form 10-Q expected to be filed with the SEC later today.

About Buzztime:
Buzztime (NYSE American: NTN) delivers interactive entertainment and innovative technology that helps its customers acquire, engage and retain its patrons. Most frequently used in bars and restaurants in North America, the Buzztime tablets, mobile app and technology offer engaging solutions to establishments that have guests who experience dwell time, such as casinos, senior living, and more. Casual dining venues license Buzztime’s customizable solution to differentiate themselves via competitive fun by offering guests trivia, card, sports and arcade games. Buzztime’s platform creates connections among the players and venues and amplifies guests’ positive experiences. Buzztime’s in-venue TV network creates one of the largest digital out of home ad audiences in the US and Canada. Buzztime hardware solutions leverages the company’s experience manufacturing durable tablets and charging systems, enabling a diverse group of businesses including corrections, point-of-sale and loyalty with product implementation. Buzztime games have also been recently licensed by other businesses serving other markets. For more information, please visit http://www.buzztime.com or follow us on Facebook or Twitter@buzztime.

Additional Information and Where to Find It
In connection with the proposed merger and asset sale, Buzztime filed relevant materials with the SEC, including a registration statement on Form S-4, that will serve as a proxy statement and prospectus of Buzztime and a consent solicitation statement for the beneficial holders of Brooklyn’s Class A membership units, and will be mailed or otherwise disseminated to Buzztime stockholders and to the beneficial holders of Brooklyn’s Class A membership units if and when it becomes available. INVESTORS AND SECURITY HOLDERS OF BUZZTIME AND BROOKLYN ARE URGED TO READ THESE MATERIALS CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT BUZZTIME, BROOKLYN, THE PROPOSED MERGER AND ASSET SALE, AND RELATED MATTERS. The proxy statement/prospectus/consent solicitation statement and other relevant materials (when they become available) and any other documents filed by Buzztime with the SEC, may be obtained free of charge at the SEC website at www.sec.gov. In addition, investors and security holders may obtain free copies of the documents filed with the SEC by Buzztime by directing a written request to: NTN Buzztime, Inc, 6965 El Camino Real, Suite 105-Box 517, Carlsbad, California 92009. Investors and security holders are urged to read the proxy statement/prospectus/consent solicitation statement and the other relevant materials when they become available before making any voting or investment decision with respect to the proposed merger and asset sale.

Participants in the Solicitation
Buzztime and its directors, executive officers and certain other members of management and employees, Brooklyn and its managers and officers, and eGames.com and its managers and officers may, under SEC rules, be deemed to be participants in the solicitation of proxies from the stockholders of Buzztime with respect to the proposed merger and asset sale and related matters. Information about the directors and executive officers of Buzztime, including their ownership of shares of common stock is set forth in Buzztime’s Annual Report on Form 10-K for the year ended December 31, 2019 and Amendment No. 1 thereto, which were filed with the SEC on March 19, 2020 and April 27, 2020, respectively. Additional information regarding the persons or entities who may be deemed participants in the solicitation of proxies from Buzztime stockholders, including a description of their interests in the proposed merger and asset sale, by security holdings or otherwise, are included in the joint proxy statement/prospectus/consent solicitation statement referred to above and other relevant documents to be filed with the SEC when they become available. As described above, these documents will be available free of charge at the SEC’s website or by directing a written request to Buzztime. Neither the managers or officers of Brooklyn nor the managers or officers of eGames.com currently hold any interests, by security holdings or otherwise, in Buzztime.

Forward-Looking Statements

This press release contains 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 harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are any statements that are not statements of historical fact and may be identified by terminology such as “expect,” “intend,” “plan,” “believe,” “anticipate,” “may,” “will,” “would,” “should,” “could,” “contemplate,” “estimate,” “predict,” “potential” or “continue,” or the negative of these terms or other similar words. These forward-looking statements include, but are not limited to, statements concerning: the completion of the proposed asset sale and merger and the anticipated timing thereof, the benefits of the proposed asset sale and merger for Buzztime’s stockholders and other stakeholders. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties and are not guarantees of future performance.

Actual results could differ materially from those stated or implied in any forward-looking statement as a result of various factors, including, but not limited to: (i) risks that the conditions to the closing of the proposed merger and/or asset sale are not satisfied, including the failure of Buzztime and Brooklyn to timely obtain the requisite stockholder and member approvals for the merger and/or asset sale and related matters, or to meet the net cash and capitalization requirements under the merger agreement, as applicable; (ii) uncertainties as to the timing of the consummation of the proposed merger and asset sale and the ability of each party to consummate the proposed merger and asset sale; (iii) risks related to Buzztime’s and Brooklyn’s ability to manage their respective operating expenses and their expenses associated with the proposed merger and asset sale, as applicable, pending closing; (iv) uncertainties related to the impact of the COVID-19 pandemic on the business and financial condition of Buzztime and the ability of Buzztime and Brooklyn to consummate the merger and Buzztime and eGames.com to consummate the asset sale; (v) Buzztime’s ability to continue to operate as a going concern if the proposed merger or asset sale is not consummated in a timely manner, or at all; (vi) the outcome of any legal proceedings that have been instituted against Buzztime, Brooklyn or others related to the merger agreement and the asset purchase agreement; (vii) the occurrence of any event, change or other circumstance or condition that could give rise to the termination of either or both of those agreements; (viii) potential adverse reactions or changes to business relationships resulting from the announcement or completion of the proposed merger or asset sale; and (ix) those risks and uncertainties discussed in Buzztime’s reports filed with the SEC, including its most recent Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as other documents that may be filed by Buzztime from time to time with the SEC available at www.sec.gov.

You should not rely upon forward-looking statements as predictions of future events. Buzztime cannot assure you that the events and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results could differ materially from those projected in the forward-looking statements. The forward-looking statements made in this communication speak only as of the date on which they were made. Buzztime does not undertake any obligation to update the forward-looking statements contained herein to reflect events that occur or circumstances that exist after the date hereof, except as may be required by applicable law or regulation.

IR AGENCY CONTACT:
Kirsten Chapman, LHA Investor Relations, [email protected] 415-433-3777

NTN BUZZTIME, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except par value amount)

ASSETS	September 30, 2020	December 31, 2019
Current Assets:	(unaudited)
Cash and cash equivalents	$ 1,710	$ 3,209
Restricted cash	—	50
Accounts receivable, net	132	1,195
Income tax receivable	13	—
Site equipment to be installed	792	1,090
Prepaid expenses and other current assets	146	526
Total current assets	2,793	6,070

Restricted cash, long-term	—	150
Operating lease right-of-use assets	5	2,101
Fixed assets, net	689	2,822
Software development costs, net	1,420	1,915
Deferred costs	85	274
Goodwill	—	696
Other assets	62	97

Total assets	$ 5,054	$ 14,125

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$ 275	$ 835
Accrued compensation	125	588
Accrued expenses	490	490
Sales taxes payable	14	131
Income taxes payable	—	3
Current portion of long-term debt	1,724	2,739
Current portion of obligations under operating leases	5	409
Current portion of obligations under financing leases	23	21
Current portion of deferred revenue	120	460
Other current liabilities	154	419
Total current liabilities	2,930	6,095

Long-term debt	1,625	—
Obligations under operating leases	—	2,891
Obligations under financing leases	4	20
Deferred revenue	—	2
Other liabilities	—	26
Total liabilities	4,559	9,034


Shareholders’ equity:
Series A 10% cumulative convertible preferred stock, $0.005 par value, $156 liquidation preference, 156 shares authorized; 156 shares issued and outstanding at September 30, 2020 and December 31, 2019	1	1
Common stock, $0.005 par value, 15,000 shares authorized at September 30, 2020 and December 31, 2019; 2,952 and 2,901 shares issued at September 30, 2020 and December 31, 2019, respectively	15	14
Treasury stock, at cost, 10 shares at September 30, 2020 and December 31, 2019	(456)	(456)
Additional paid-in capital	136,881	136,721
Accumulated deficit	(136,187)	(131,457)
Accumulated other comprehensive income	241	268
Total shareholders’ equity	495	5,091

Total liabilities and shareholders’ equity	$ 5,054	$ 14,125

NTN BUZZTIME, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (unaudited) (In thousands, except per share data)

	Three months ended September 30,		Nine months ended September 30,
	2020	2019	2020	2019
Revenues
Subscription revenue	$ 1,053	$ 3,723	$ 3,779	$ 11,356
Hardware revenue	379	11	421	811
Other revenue	45	846	425	2,471
Total revenues	1,477	4,580	4,625	14,638

Operating expenses:
Direct operating costs (includes depreciation and amortization)	801	1,344	2,364	4,545
Selling, general and administrative	2,068	3,413	6,743	10,303
Impairment of capitalized software	—	51	238	52
Impairment of goodwill	—	—	662	—
Depreciation and amortization (excluding depreciation and amortization included in direct costs)	26	88	189	273
Total operating expenses	2,895	4,896	10,196	15,173
Operating loss	(1,418)	(316)	(5,571)	(535)
Other (expense) income, net	(82)	(16)	826	(189)
Loss before income taxes	(1,500)	(332)	(4,745)	(724)
Income tax benefit (provision)	19	(19)	23	(30)
Net loss	(1,481)	(351)	(4,722)	(754)
Series A preferred stock dividend	—	—	(8)	(8)
Net loss attributable to common shareholders	$ (1,481)	$ (351)	$ (4,730)	$ (762)

Net loss per common share – basic and diluted	$ (0.50)	$ (0.12)	$ (1.62)	$ (0.27)

Weighted average shares outstanding – basic and diluted	2,936	2,874	2,920	2,870

Comprehensive loss:
Net loss	$ (1,481)	$ (351)	$ (4,722)	$ (754)
Foreign currency translations adjustment	1	(18)	(27)	47
Total comprehensive loss	$ (1,480)	$ (396)	$ (4,749)	$ (707)

NTN BUZZTIME, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (In thousands)

	Nine months ended September 30,
	2020	2019
Cash flows (used in) provided by operating activities:
Net loss	$ (4,722)	$ (754)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization	1,430	2,191
Provision for doubtful accounts	124	144
Amortization of operating lease right-of-use assets	161	217
Common stock issued for compensation in lieu of cash payment	61	—
Transfer of fixed assets to sales-type lease	—	7
Stock-based compensation	135	172
Gain from the asset sale of Stump! Trivia and OpinioNation	(1,225)	—
Loss from the termination of operating leases	9	—
Loss (gain) from the disposition or sale of assets	511	(5)
Loss from impairment of capitalized software	238	52
Loss from impairment of goodwill	662	—
Amortization of debt issuance costs	12	7
Changes in assets and liabilities:
Accounts receivable	939	222
Site equipment to be installed	51	475
Operating lease liabilities	(154)	(111)
Prepaid expenses and other assets	353	(66)
Accounts payable and accrued expenses	(1,405)	(196)
Income taxes	(16)	4
Deferred costs	189	84
Deferred revenue	(342)	(541)
Other liabilities	(291)	(141)
Net cash (used in) provided by operating activities	(3,280)	1,761

Cash flows used in investing activities:
Capital expenditures	(21)	(111)
Capitalized software development expenditures	(173)	(882)
Proceeds from the sale of equipment	—	29
Net cash used in investing activities	(194)	(964)

Cash flows provided by (used in) financing activities:
Net proceeds from the sale of Stump! Trivia and OpinoNation	1,226	—
Proceeds on long-term debt	2,625	—
Payment on long-term debt	(2,025)	(750)
Debt issuance costs on long-term debt	(3)	—
Principal payments on financing leases	(14)	(39)
Payment of preferred stockholder dividends	(8)	(8)
Payroll taxes remitted on net share settlement of equity awards	(36)	(29)
Net cash provided by (used in) financing activities	1,765	(826)

Effect of exchange rate on cash and cash equivalents	10	27
Net decrease in cash and cash equivalents	(1,699)	(2)
Cash, cash equivalents and restricted cash at beginning of period	3,409	2,786
Cash, cash equivalents and restricted cash at end of period	$ 1,710	$ 2,984

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SOURCE NTN Buzztime, Inc.

November 13, 2020 6:33 am

Amesite CEO Dr. Ann Marie Sastry Scheduled to Appear on CNBC’s Squawk Box Monday at 6:45 a.m. ET

Founder of the remote learning software company to talk about the changing dynamic of the workplace, the new normal in technology, and supporting and training remote and in-person workforces

PR Newswire

ANN ARBOR, Mich., Nov. 13, 2020 /PRNewswire/ — AmesiteInc. (Nasdaq: AMST), an artificial intelligence software company providing online learning ecosystems for business, higher education, and K-12, announced today its CEO, Dr. Ann Marie Sastry, is scheduled to appear on CNBC’s Squawk Box Monday morning at 6:45 a.m. ET.

Dr. Sastry will discuss how workplaces are adapting and what the future of work looks like, how technology is evolving to meet the changing needs of business during the pandemic, and how to best support remote and in-person workforces with highly effective virtual training.

About Amesite Inc.

Amesite is a high-tech artificial intelligence software company offering a cloud-based platform and content creation services for K-12, college, university and business education and upskilling. Amesite-offered courses and programs are branded to our customers. Amesite uses artificial intelligence technologies to provide customized environments for learners, easy-to-manage interfaces for instructors, and greater accessibility for learners in the US education market and beyond. The Company leverages existing institutional infrastructures, adding mass customization and cutting-edge technology to provide cost-effective, scalable and engaging experiences for learners anywhere. For more information, visit https://amesite.com.

Forward Looking Statements

This communication contains forward-looking statements (including within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended) concerning the Company, the Company’s planned online machine learning platform, the Company’s business plans, any future commercialization of the Company’s online learning solutions, potential customers, business objectives and other matters. Forward-looking statements generally include statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “may,” “will,” “should,” “would,” “expect,” “plan,” “believe,” “intend,” “look forward,” and other similar expressions among others. Statements that are not historical facts are forward-looking statements. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties and are not guarantees of future performance. Actual results could differ materially from those contained in any forward-looking statement. Risks facing the Company and its planned platform are set forth in the Company’s filings with the SEC. Except as required by applicable law, the Company undertakes no obligation to revise or update any forward-looking statement, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.

Media Contact: Robert Busweiler – [email protected] – 631.379.6454

View original content:http://www.prnewswire.com/news-releases/amesite-ceo-dr-ann-marie-sastry-scheduled-to-appear-on-cnbcs-squawk-box-monday-at-645-am-et-301172435.html

SOURCE Amesite Inc.

November 13, 2020 6:33 am

3M Reports Sales Information for Month of October 2020

3M Reports Sales Information for Month of October 2020

ST. PAUL, Minn.–(BUSINESS WIRE)–
3M (NYSE: MMM) today reported sales information for the month of October 2020.

Total sales for October increased 3 percent year-on-year to $2.9 billion. Organic local-currency sales (which includes organic volume impacts and selling price changes) increased 2 percent, and acquisitions, net of divestitures, added 1 percent while foreign currency translation was flat year-on-year.

Total sales increased 12 percent in Health Care, 7 percent in Consumer, and 4 percent in Safety and Industrial, while Transportation and Electronics declined 4 percent. Organic local-currency sales increased 8 percent in both Health Care and Consumer, and 4 percent in Safety and Industrial, while Transportation and Electronics declined 4 percent.

On a geographic basis, total sales increased 3 percent in Asia Pacific, and 2 percent in both EMEA (Europe, Middle East and Africa) and the Americas. Organic local-currency sales increased 2 percent in the Americas (including the U.S. up 3 percent), and 1 percent in both Asia Pacific (including China up 13 percent and Japan down 4 percent) and EMEA.

Forward-Looking Statements

This news release contains forward-looking information about 3M’s financial results and estimates and business prospects that involve substantial risks and uncertainties. You can identify these statements by the use of words such as “anticipate,” “estimate,” “expect,” “aim,” “project,” “intend,” “plan,” “believe,” “will,” “should,” “could,” “target,” “forecast” and other words and terms of similar meaning in connection with any discussion of future operating or financial performance or business plans or prospects. Among the factors that could cause actual results to differ materially are the following: (1) worldwide economic, political, regulatory, international trade and other external conditions and other factors beyond the Company’s control, including natural and other disasters or climate change affecting the operations of the Company or its customers and suppliers; (2) risks related to public health crises such as the global pandemic associated with the coronavirus (COVID-19); (3) foreign currency exchange rates and fluctuations in those rates; (4) liabilities related to certain fluorochemicals, including lawsuits concerning various PFAS-related products and chemistries, and claims and governmental regulatory proceedings and inquiries related to PFAS in a variety of jurisdictions; (5) legal and regulatory proceedings and legal compliance risks involving the Company and/or third parties, including significant developments that could occur in the legal and regulatory proceedings described in the Company’s Annual Report on Form 10-K for the year ended Dec. 31, 2019, and any subsequent quarterly reports on Form 10-Q (the “Reports”); (6) competitive conditions and customer preferences; (7) the timing and market acceptance of new product offerings; (8) materials vulnerability and the availability and cost of purchased components, compounds, raw materials and energy (including oil and natural gas and their derivatives) due to shortages, increased demand or supply interruptions, manufacturing site disruptions (including those caused by natural and other disasters and other events); (9) problems or delays with the phased implementation of a global enterprise resource planning (ERP) system, or security breaches and other disruptions to the Company’s information technology infrastructure; (10) the impact of acquisitions, strategic alliances, divestitures and other unusual events resulting from portfolio management actions and other evolving business strategies, and possible organizational restructuring; (11) operational execution, including scenarios where the Company generates fewer productivity improvements than estimated; (12) financial market risks that may affect the Company’s funding obligations under defined benefit pension and postretirement plans; and (13) the Company’s credit ratings and its cost of capital. Changes in such assumptions or factors could produce significantly different results. A further description of these factors is located in the Reports under “Cautionary Note Concerning Factors That May Affect Future Results” and “Risk Factors” in Part I, Items 1 and 1A (Annual Report) and in Part I, Item 2 and Part II, Item 1A (Quarterly Reports), as updated by applicable Current Reports on Form 8-K. The information contained in this news release is as of the date indicated. The Company assumes no obligation to update any forward-looking statements contained in this news release as a result of new information or future events or developments.

About 3M

At 3M, we apply science in collaborative ways to improve lives daily. With $32 billion in sales, our 96,000 employees connect with customers all around the world. Learn more about 3M’s creative solutions to the world’s problems at www.3M.com or on Twitter @3M or @3MNews.

View source version on businesswire.com: https://www.businesswire.com/news/home/20201113005205/en/

3M

Investor Contacts:

Bruce Jermeland, 651-733-1807

or

Tony Riter, 651-733-1141

or

Media Contact:

Stephen Sanchez, 651-737-5967

KEYWORDS: United States North America Minnesota

INDUSTRY KEYWORDS: Professional Services Packaging Engineering Chemicals/Plastics Manufacturing Finance Other Manufacturing

MEDIA:

November 13, 2020 6:33 am

Spectrum Brands Holdings Reports Fiscal 2020 Fourth Quarter and Full Year Results

Spectrum Brands Holdings Reports Fiscal 2020 Fourth Quarter and Full Year Results

Fourth Quarter Net Sales Increased 17.9% and Organic Net Sales Increased 17.1% Reflecting Strong Growth Across All Business Units
Fourth Quarter Operating Income and Adjusted EBITDA Increased, Driven by Strong Volumes and Gross Margins Improvement of 240 Basis Points
Full Year Cash Flow From Operations of $290 Million; Adjusted Free Cash Flow of $254 Million
Raising Total Savings Gross Target from Global Productivity Improvement Program from $100 Million to $150 Million
Strong Balance Sheet with Over $1.1 Billion of Total Liquidity
Full Year Operating Income of $243 Million and Full Year Adjusted EBITDA of $580 Million
The Company Expects to Deliver 3% to 5% Net Sales Growth and Mid Single-Digit Adjusted EBITDA Growth for Fiscal 2021

MIDDLETON, Wis.–(BUSINESS WIRE)–
Spectrum Brands Holdings, Inc. (NYSE: SPB; “Spectrum Brands” or the “Company”), a leading global branded consumer products and home essentials company focused on driving innovation and providing exceptional customer service, today reported results from continuing operations for the fourth quarter and full year of fiscal 2020 ended September 30, 2020.

“Our Q4 and full year financial results reflect a better, faster and stronger Spectrum Brands, with net sales, operating income and adjusted EBITDA growth. During the quarter, our net sales accelerated as we grew 17.9%, with strong growth across all business units. These top line results reflect elevated demand levels, with strong POS and improved output. This is evidence of our quick recovery from COVID-19 related supply disruptions earlier in the year. Additionally, our incremental marketing and advertising investments are paying dividends by driving stronger organic top line growth. Operating Income and Adjusted EBITDA growth was driven by strong volumes and improved gross margins. Adjusted EBITDA in Q4 2020 includes a change to our annual incentive compensation program converting to cash payment from a mix of equity and cash in order to better align with industry best practices and our peer group. This change negatively impacts comparability, with $17 million in incremental corporate expense in the quarter. If not for the change, we would have delivered $190 million in adjusted EBITDA this quarter and $597 million in the full year,” said David Maura, Chairman and Chief Executive Officer of Spectrum Brands.

“We believe we are better positioned today than we have ever been to drive demand as a home essentials company with consumers needing our brands and products more than ever. Additionally, with the supply chain disruptions from COVID-19 earlier in 2020 largely behind us, momentum in the business remains strong, and with continued strong demand in October, fiscal 2021 is off to a great start,” said Mr. Maura.

Fiscal 2020 Fourth Quarter Highlights

	Three Month Periods Ended
(in millions, except per share and %)	September 30, 2020		September 30, 2019		Variance
Net sales	$	1,170.6	$	993.0	$	177.6	17.9	%
Gross profit	423.0		334.7		88.3		26.4	%
Operating income (loss)	126.7		(87.5)		214.2		n/m
Net income (loss) from continuing operations	43.8		(79.0)		122.8		n/m
Diluted earnings (loss) per share from continuing operations	$	1.01	$	(1.62)	$	2.63	n/m
Non-GAAP Operating Metrics
Adjusted EBITDA from continuing operations	$	173.3	$	163.1	$	10.2	6.3	%
Adjusted EPS from continuing operations	$	1.72	$	1.13	$	0.59	52.2	%
n/m = not meaningful

Net sales increased 17.9%. Excluding the impact of $4.2 million of favorable foreign exchange rates and acquisition sales of $3.8 million, organic net sales increased 17.1%, with growth across all four business units.
Gross profit margin increased 240 basis points, driven by improved productivity from our Global Productivity Improvement Program (GPIP), favorable pricing and mix.
Operating income growth compared to the prior year was driven by improved volumes and profit margins and lower restructuring spending, as well as no impairment charges in the current year period.
Net income and diluted earnings per share increases were driven by the operating income growth and lower shares outstanding.
Adjusted EBITDA increased $10.2 million, primarily driven by volume growth, as well as productivity improvements and positive pricing. By business unit, the adjusted EBITDA growth was driven by HHI, GPC and Home & Garden. Adjusted EBITDA also increased despite a change to incentive compensation program, which resulted in a $17 million reduction of consolidated adjusted EBITDA of $17.0 million for FY 2020 and Q4 2020. This change will have a corresponding reduction in the Company’s annual equity compensation expense, resulting in a net neutral impact on the Company’s annual compensation expense.
Adjusted diluted EPS increased 52.2% due to favorable volumes, improved productivity and positive product mix.
Full year Cash Flow From Operations was $290.3 million and Adjusted Free Cash Flow was $254.0 million.
Increased the total gross savings target from the entirety of the Global Productivity Improvement Program (GPIP) to $150 million (previously at least $100 million).
The Company sold 1.5 million shares of Energizer common stock during the quarter for proceeds of $67.4 million and ended the quarter with approximately 1.7 million shares.

Fiscal 2020 Fourth Quarter Segment Level Data

Hardware & Home Improvement (HHI)

	Three Month Periods Ended
(in millions, except %)	September 30, 2020			September 30, 2019			Variance
Net Sales	$	433.7		$	364.9		$	68.8		18.9	%
Operating Income	94.3			69.7			24.6			35.3	%
Operating Income Margin	21.7		%	19.1		%	260		bps
Adjusted EBITDA	$	100.4		$	77.8		$	22.6		29.0	%
Adjusted EBITDA Margin	23.1		%	21.3		%	180		bps
n/m = not meaningful

Net sales were driven by growth across all categories during the quarter. Security sales growth was driven by strong consumer demand and stronger shipment of backlog orders. Builders hardware and plumbing category performance continued to be driven by elevated demand from the repair and remodel channel. Organic net sales increased 18.7% with slightly favorable foreign exchange impacts. Customer demand in security remains strong, and the Company expects continued benefit from backlog shipments for the upcoming quarter.

Higher operating income, adjusted EBITDA and margins were primarily driven by positive volumes, as well as productivity improvements, favorable mix and pricing, partially offset by higher tariff and COVID-19 related costs.

Home & Personal Care (HPC)

	Three Month Periods Ended
(in millions, except %)	September 30, 2020			September 30, 2019			Variance
Net Sales	$	302.3		$	285.8		$	16.5		5.8	%
Operating Income (Loss)	11.4			(118.5)			129.9			n/m
Operating Income Margin	3.8		%	(41.5)		%	4,530		bps
Adjusted EBITDA	$	22.7		$	29.4		$	(6.7)		(22.8)	%
Adjusted EBITDA Margin	7.5		%	10.3		%	(280)		bps
n/m = not meaningful

Net sales were driven by growth in both small appliances and personal care. This included strong net sales growth in the U.S. from e-commerce and mass channels and small appliances category performance, with continued strength in convenience cooking including new product introductions from George Foreman grills. Excluding favorable foreign exchange impacts of $0.5 million, organic net sales grew 5.6%.

Improved operating income benefited from no impairment charges in the current year period. Operating income, as well as lower adjusted EBITDA and margins were driven by more than doubling our advertisement and promotional investments, as well as higher tariff and legal costs. This was partially offset by improved productivity and higher volumes.

Global Pet Care (GPC)

	Three Month Periods Ended
(in millions, except %)	September 30, 2020			September 30, 2019			Variance
Net Sales	$	278.3		$	228.9		$	49.4		21.6	%
Operating Income	35.9			7.0			28.9			412.9	%
Operating Income Margin	12.9		%	3.1		%	980		bps
Adjusted EBITDA	$	49.9		$	41.7		$	8.2		19.7	%
Adjusted EBITDA Margin	17.9		%	18.2		%	(30)		bps
n/m = not meaningful

Higher net sales were attributable to continued growth in both aquatic and companion animal categories. Companion animal performance was driven by strong consumables demand in the dollar, mass and e-commerce channels, while aquatics was driven by broad based demand across all aquatics categories, including significant demand for hard goods. Excluding favorable foreign exchange impacts of $3.2 million and acquisition sales of $3.8 million, organic net sales grew 18.5%.

Higher operating income and adjusted EBITDA were driven by volume growth, productivity improvements and positive pricing, partially offset by additional marketing investments and higher volume driven tariff costs. Operating income growth also benefited from the write-off of intangible assets realized in the prior year and lower restructuring costs.

Home & Garden (H&G)

	Three Month Periods Ended
(in millions, except %)	September 30, 2020			September 30, 2019			Variance
Net Sales	$	156.3		$	113.4		$	42.9		37.8	%
Operating Income	26.4			14.2			12.2			85.9	%
Operating Income Margin	16.9		%	12.5		%	440		bps
Adjusted EBITDA	$	31.5		$	19.6		$	11.9		60.7	%
Adjusted EBITDA Margin	20.2		%	17.3		%	290		bps
n/m = not meaningful

Net sales grew across all three major categories – controls, household insecticides and repellents and benefited from strong point of sale and replenishment as retailers supported the extended selling season.

Higher operating income, adjusted EBITDA and margins were driven by higher volumes, pricing, and productivity improvements, despite significantly higher marketing investments and higher manufacturing and distribution costs.

Liquidity and Debt

As of the end of the fiscal year, the Company had a cash balance of $531.6 million and approximately $579 million available on its $600 million Cash Flow Revolver.

The Company had approximately $2,512.8 million of debt outstanding, consisting of approximately $2,349.1 million of senior unsecured notes and approximately $163.7 million of finance leases and other obligations.

Net leverage improved to 3.4 times at the end of the fiscal fourth quarter from 3.95 times at the end of the previous quarter.

Fiscal 2021 Outlook

Spectrum Brands expects three to five percent reported net sales growth, with foreign exchange expected to have a slightly positive impact based upon current rates.

Fiscal 2021 adjusted EBITDA is expected to increase mid single-digits. Adjusted free cash flow is expected to be between $250 million and $270 million, with strategic investments in inventory levels and other working capital needs for the upcoming year.

Conference Call/Webcast Scheduled for 9:00 A.M. Eastern Time Today

Spectrum Brands will host an earnings conference call and webcast at 9:00 a.m. Eastern Time today, November 13, 2020. To access the live conference call, U.S. participants may call 877-604-7329 and international participants may call 602-563-8688. The conference ID number is 3218924. A live webcast and related presentation slides will be available by visiting the Event Calendar page in the Investor Relations section of Spectrum Brands’ website at www.spectrumbrands.com.

A replay of the live webcast also will be accessible through the Event Calendar page in the Investor Relations section of the Company’s website. A telephone replay of the conference call will be available through November 27. To access this replay, participants may call 855-859-2056 and use the same conference ID number.

About Spectrum Brands Holdings, Inc.

Spectrum Brands Holdings, a member of the Russell 1000 Index, is a leading supplier of residential locksets, residential builders’ hardware, plumbing, shaving and grooming products, personal care products, small household appliances, specialty pet supplies, lawn and garden and home pest control products, and personal insect repellents. Helping to meet the needs of consumers worldwide, Spectrum Brands offers a broad portfolio of market-leading, well-known and widely trusted brands including Kwikset®, Weiser®, Baldwin®, National Hardware®, Pfister®, Remington®, George Foreman®, Russell Hobbs®, Black+Decker®, Tetra®, Marineland®, Nature’s Miracle®, Dingo®, 8-in-1®, FURminator®, IAMS® and Eukanuba® (Europe only), Digest-eeze™, Healthy-Hide®, Littermaid®, Spectracide®, Cutter®, Repel®, Hot Shot®, Black Flag® and Liquid Fence®. For more information, please visit www.spectrumbrands.com.Spectrum Brands – A Home Essentials Company™

Non-GAAP Measurements

Management believes that certain non-GAAP financial measures may be useful in providing additional meaningful comparisons between current results and results in prior periods. Management believes that organic net sales provide for a more complete understanding of underlying business trends of regional and segment performance by excluding the impact of currency exchange rate fluctuations and the impact of acquisitions. In addition, within this release, including the supplemental information attached hereto, reference is made to adjusted diluted EPS, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), and adjusted EBITDA margin. Adjusted EBITDA is a metric used by management to evaluate segment performance and frequently used by the financial community which provides insight into an organization’s operating trends and facilitates comparisons between peer companies, since interest, taxes, depreciation and amortization can differ greatly between organizations as a result of differing capital structures and tax strategies. Adjusted EBITDA also is one of the measures used for determining compliance with the Company’s debt covenants. Adjusted EBITDA excludes certain items that are unusual in nature or not comparable from period to period. Adjusted EBITDA margin reflects adjusted EBITDA as a percentage of net sales of the Company. The Company’s management uses adjusted diluted EPS as one means of analyzing the Company’s current and future financial performance and identifying trends in its financial condition and results of operations. Management believes that adjusted diluted EPS is a useful measure for providing further insight into our operating performance because it eliminates the effects of certain items that are not comparable from one period to the next. An income tax adjustment is included in adjusted diluted EPS to exclude the impact of the valuation allowance against deferred taxes and other tax-related items in order to reflect a normalized ongoing effective tax rate. The Company provides this information to investors to assist in comparisons of past, present and future operating results and to assist in highlighting the results of on-going operations. While the Company’s management believes that non-GAAP measurements are useful supplemental information, such adjusted results are not intended to replace the Company’s GAAP financial results and should be read in conjunction with those GAAP results. Other Supplemental Information has been provided to demonstrate reconciliation of non-GAAP measurements discussed above to most relevant GAAP financial measurements.

Forward-Looking Statements

We have made, implied or incorporated by reference certain forward-looking statements in this document. All statements, other than statements of historical facts included or incorporated by reference in this document, without limitation, statements or expectations regarding our Global Productivity Improvement Program, our business strategy, future operations, financial condition, estimated revenues, projected costs, projected synergies, prospects, plans and objectives of management, information concerning expected actions of third parties, retention and future compensation of key personnel, our ability to meet environmental, social, and governance goals, the expected impact of the COVID-19 pandemic, economic, social, and political conditions or civil unrest in the U.S. and other countries, and other statements regarding the Company’s ability to meet its expectations for its fiscal 2020 are forward-looking statements. When used in this document, the words future, anticipate, pro forma, seeks, intend, plan, envision, estimate, believe, belief, expect, project, forecast, outlook, goal, target, could, would, will, can, should, may and similar expressions are also intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words.

Since these forward-looking statements are based upon our current expectations of future events and projections and are subject to a number of risks and uncertainties, many of which are beyond our control and some of which may change rapidly, actual results or outcomes may differ materially from those expressed or implied herein, and you should not place undue reliance on these statements. Important factors that could cause our actual results to differ materially from those expressed or implied herein include, without limitation: (1) the impact of the COVID-19 pandemic on our customers, employees, manufacturing facilities, suppliers, the capital markets and our financial condition, and results of operations, all of which tend to aggravate the other risks and uncertainties we face; (2) the impact of our indebtedness on our business, financial condition and results of operations; (3) the impact of restrictions in our debt instruments on our ability to operate our business, finance our capital needs or pursue or expand business strategies; (4) any failure to comply with financial covenants and other provisions and restrictions of our debt instruments; (5) the effects of general economic conditions, including the impact of, and changes to tariffs and trade policies, inflation, recession or fears of a recession, depression or fears of a depression, labor costs and stock market volatility or monetary or fiscal policies in the countries where we do business; (6) the impact of fluctuations in commodity prices, costs or availability of raw materials or terms and conditions available from suppliers, including suppliers’ willingness to advance credit; (7) interest rate and exchange rate fluctuations; (8) the loss of, significant reduction in, or dependence upon, sales to any significant retail customer(s); (9) competitive promotional activity or spending by competitors, or price reductions by competitors; (10) the introduction of new product features or technological developments by competitors and/or the development of new competitors or competitive brands; (11) the impact of actions taken by significant stockholders; (12) changes in consumer spending preferences and demand for our products, particularly in light of the COVID-19 pandemic and economic stress; (13) our ability to develop and successfully introduce new products, protect our intellectual property and avoid infringing the intellectual property of third parties; (14) our ability to successfully identify, implement, achieve and sustain productivity improvements (including our Global Productivity Improvement Program), cost efficiencies (including at our manufacturing and distribution operations) and cost savings; (15) the seasonal nature of sales of certain of our products; (16) the effects of climate change and unusual weather activity, as well as further natural disasters and pandemics; (17) the cost and effect of unanticipated legal, tax or regulatory proceedings or new laws or regulations (including environmental, public health and consumer protection regulations); (18) our discretion to conduct, suspend or discontinue our share repurchase program (including our discretion to conduct purchases, if any, in a variety of manners including open-market purchases or privately negotiated transactions); (19) public perception regarding the safety of products that we manufacture and sell, including the potential for environmental liabilities, product liability claims, litigation and other claims related to products manufactured by us and third parties; (20) the impact of existing, pending or threatened litigation, government regulations or other requirements or operating standards applicable to our business; (21) the impact of cybersecurity breaches or our actual or perceived failure to protect company and personal data, including our failure to comply with new and increasingly complex global data privacy regulations; (22) changes in accounting policies applicable to our business; (23) our ability to utilize net operating loss carry-forwards to offset tax liabilities from future taxable income; (24) the impact of expenses resulting from the implementation of new business strategies, divestitures or current and proposed restructuring activities; (25) our ability to successfully implement further acquisitions or dispositions and the impact of any such transactions on our financial performance; (26) the unanticipated loss of key members of senior management and the transition of new members of our management teams to their new roles; (27) the impact of economic, social and political conditions or civil unrest in the U.S. and other countries; (28) the effects of political or economic conditions, terrorist attacks, acts of war, natural disasters, public health concerns or other unrest in international markets; (29) our ability to achieve our goals regarding environmental, social and governance practices; (30) our increased reliance on third party partners, suppliers, and distributors to achieve our business objectives; and (31) the other risk factors set forth in the securities filings of Spectrum Brands Holdings, Inc. and SB/RH Holdings, LLC, including the 2020 Annual Report and subsequent Quarterly Reports on Form 10-Q.

Some of the above-mentioned factors are described in further detail in the sections entitled “Risk Factors” in our annual and quarterly reports, as applicable. You should assume the information appearing in this document is accurate only as of the date hereof, or as otherwise specified, as our business, financial condition, results of operations and prospects may have changed since such date. Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the United States Securities and Exchange Commission, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, to reflect actual results or changes in factors or assumptions affecting such forward-looking statements.

SPECTRUM BRANDS HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

	Three Month Periods Ended				Twelve Month Periods Ended
(in millions, except per share amounts)	September 30, 2020		September 30, 2019		September 30, 2020		September 30, 2019
Net sales	$	1,170.6	$	993.0	$	3,964.2	$	3,802.1
Cost of goods sold	745.8		657.0		2,580.0		2,492.4
Restructuring and related charges	1.8		1.3		14.3		2.8
Gross profit	423.0		334.7		1,369.9		1,306.9
Selling	177.2		141.5		614.5		600.5
General and administrative	92.1		90.9		337.8		354.6
Research and development	12.1		10.8		41.8		43.5
Restructuring and related charges	9.2		22.2		58.3		62.9
Transaction related charges	5.7		5.4		23.1		21.8
Loss on assets held for sale	—		—		26.8		—
Write-off from impairment of goodwill	—		116.0		—		116.0
Write-off from impairment of intangible assets	—		35.4		24.2		35.4
Total operating expenses	296.3		422.2		1,126.5		1,234.7
Operating income	126.7		(87.5)		243.4		72.2
Interest expense	38.0		37.0		144.5		222.1
Gain from extinguishment of Salus CLO debt	—		—		(76.2)		—
Other non-operating expense (income), net	9.3		(20.3)		19.7		43.9
Income (loss) from continuing operations before income taxes	79.4		(104.2)		155.4		(193.8)
Income tax expense (benefit)	35.6		(25.2)		70.9		(7.1)
Net income (loss) from continuing operations	43.8		(79.0)		84.5		(186.7)
Income (loss) from discontinued operations, net of tax	1.7		(16.7)		14.0		682.5
Net income (loss)	45.5		(95.7)		98.5		495.8
Net income attributable to non-controlling interest	0.1		—		0.7		1.3
Net income (loss) attributable to controlling interest	$	45.4	$	(95.7)	$	97.8	$	494.5
Amounts attributable to controlling interest
Net income (loss) from continuing operations attributable to controlling interest	$	43.7	$	(79.0)	$	83.8	$	(188.0)
Net income (loss) from discontinued operations attributable to controlling interest	1.7		(16.7)		14.0		682.5
Net income (loss) attributable to controlling interest	$	45.4	$	(95.7)	$	97.8	$	494.5
Earnings Per Share
Basic earnings per share from continuing operations	$	1.01	$	(1.62)	$	1.88	$	(3.71)
Basic earnings per share from discontinued operations	0.04		(0.35)		0.31		13.47
Basic earnings per share	$	1.05	$	(1.97)	$	2.19	$	9.76
Diluted earnings per share from continuing operations	$	1.01	$	(1.62)	$	1.87	$	(3.71)
Diluted earnings per share from discontinued operations	0.04		(0.35)		0.31		13.47
Diluted earnings per share	$	1.05	$	(1.97)	$	2.18	$	9.76
Weighted Average Shares Outstanding
Basic	43.1		48.8		44.7		50.7
Diluted	43.4		48.8		44.9		50.7

SPECTRUM BRANDS HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOW (Unaudited)

	Twelve Month Periods Ended
(in millions)	September 30, 2020		September 30, 2019
Cash flows from operating activities
Net cash provided by operating activities from continuing operations	$	290.1	$	83.5
Net cash provided (used) by operating activities from discontinued operations	0.2		(82.4)
Net cash provided by operating activities	290.3		1.1
Cash flows from investing activities
Purchases of property, plant and equipment	(61.0)		(58.4)
Proceeds from disposal of property, plant and equipment	4.2		2.1
Proceeds from sale of assets held for sale	29.0		—
Proceeds from sale of discontinued operations, net of cash	3.6		2,859.5
Business acquisitions, net of cash acquired	(16.9)		—
Proceeds from sale of equity investment	147.1		—
Other investing activity	2.3		(0.3)
Net cash provided by investing activities from continuing operations	108.3		2,802.9
Net cash used by investing activities from discontinued operations	—		(5.3)
Net cash provided by investing activities	108.3		2,797.6
Cash flows from financing activities
Payment of debt, including premium on extinguishment	(135.5)		(2,649.9)
Proceeds from issuance of debt	300.0		300.0
Payment of debt issuance costs	(11.5)		(4.1)
Treasury stock purchases	(239.8)		(268.5)
Accelerated share repurchase	(125.0)		—
Dividends paid to shareholders	(75.2)		(85.5)
Dividends paid by subsidiary to non-controlling interest	(0.8)		(1.1)
Share based award tax withholding payments, net of proceeds upon vesting	(12.6)		(4.4)
Payment of contingent consideration	(197.0)		(8.9)
Other financing activities, net	0.3		—
Net cash used by financing activities from continuing operations	(497.1)		(2,722.4)
Net cash used by financing activities from discontinued operations	—		(2.2)
Net cash used by financing activities	(497.1)		(2,724.6)
Effect of exchange rate changes on cash and cash equivalents	5.1		(8.4)
Net change in cash, cash equivalents and restricted cash in continuing operations	(93.4)		65.7
Cash, cash equivalents, and restricted cash, beginning of period	627.1		561.4
Cash, cash equivalents, and restricted cash, end of period	$	533.7	$	627.1

SPECTRUM BRANDS HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited)

(in millions)	September 30, 2020		September 30, 2019
Assets
Cash and cash equivalents	$	531.6	$	627.1
Trade receivables, net	501.1		356.7
Other receivables	74.2		74.2
Inventories	557.7		548.4
Prepaid expenses and other current assets	63.5		53.5
Total current assets	1,728.1		1,659.9
Property, plant and equipment, net	396.5		452.9
Operating lease assets	103.8		—
Investments	66.9		230.8
Deferred charges and other	48.3		67.2
Goodwill	1,332.0		1,328.1
Intangible assets, net	1,431.7		1,507.1
Total assets	$	5,107.3	$	5,246.0
Liabilities and Shareholders’ Equity
Current portion of long-term debt	$	15.3	$	136.9
Accounts payable	557.5		456.8
Accrued wages and salaries	95.0		72.1
Accrued interest	38.5		29.3
Indemnification payable to Energizer	33.0		230.8
Other current liabilities	205.6		214.2
Total current liabilities	944.9		1,140.1
Long-term debt, net of current portion	2,461.0		2,214.4
Long-term operating lease liabilities	88.8		—
Deferred income taxes	65.4		50.6
Other long-term liabilities	131.4		112.0
Total liabilities	3,691.5		3,517.1
Shareholders’ equity	1,407.5		1,720.9
Non-controlling interest	8.3		8.0
Total equity	1,415.8		1,728.9
Total liabilities and equity	$	5,107.3	$	5,246.0

SPECTRUM BRANDS HOLDINGS, INC.

OTHER SUPPLEMENTAL INFORMATION (Unaudited)

ADJUSTED DILUTED EPS

We define adjusted diluted EPS as reported diluted EPS excluding the effect of one-time, non-recurring activity and volatility associated with our income tax expense. The Company believes that adjusted diluted EPS provides further insight and comparability in operating performance as it eliminates the effects of certain items that are not comparable from one period to the next. Adjustments to diluted EPS include the following:

Restructuring and related charges, which consist of project costs associated with the restructuring initiatives across the Company’s segments;
Transaction related charges that consist of (1) transaction costs from qualifying acquisition transactions during the period, or subsequent integration related project costs directly associated with an acquired business; and (2) divestiture related transaction costs that are recognized in continuing operations and post-divestiture separation costs consisting of incremental costs to facilitate separation of shared operations, including development of transferred shared service operations, platforms and personnel transferred as part of the divestitures and exiting of transition service arrangements (TSAs) and reverse TSAs;
Gains and losses attributable to the Company’s investment in Energizer common stock, acquired as part of consideration received from the Company’s sale and divestiture of GAC during the year ended September 30, 2019;
Non-cash purchase accounting inventory adjustments recognized in earnings from continuing operations subsequent to an acquisition (when applicable);
Non-cash asset impairments or write-offs realized and recognized in earnings from continuing operations (when applicable);
Foreign currency gains and losses attributable to multicurrency loans for the three and twelve month periods ended September 30, 2020 and September 30, 2019, that were entered into with foreign subsidiaries in exchange for receipt of divestiture proceeds by the parent company and the distribution of the respective foreign subsidiaries’ net assets as part of the GBL and GAC divestitures during the year ended September 30, 2019. The Company has entered into various hedging arrangements to mitigate the volatility of foreign exchange risk associated with such loans;
Legal and litigation costs associated with Salus during the three and twelve month periods ended September 30, 2020 and September 30, 2019 as they are not considered a component of the continuing commercial products company, but continue to be consolidated by the Company until the Salus operations can be wholly dissolved and/or deconsolidated;
Incremental interest costs recognized for the extinguishment of the 6.625% Notes, including the cash payment of premium from early extinguishment and non-cash write-off of debt issuance costs during the twelve month period ended September 30, 2020;
Gain on extinguishment of the Salus CLO debt due to the discharge of the obligation during the twelve month period ended September 30, 2020; and
Other adjustments primarily consisting of costs attributable to (1) expenses and cost recovery for flood damage at Company facilities in Middleton, Wisconsin during the three and twelve month periods ended September 30, 2020 and September 30, 2019; (2) incremental costs for separation of a key executive during the twelve month periods ended September 30, 2020 and September 30, 2019; (3) incremental costs associated with a safety recall in GPC during the three and twelve month periods ended September 30, 2019; (4) operating margin on H&G sales to GAC discontinued operations during the three and twelve month periods ended September 30, 2019; and (5) certain fines and penalties for delayed shipments following the completion of a GPC distribution center consolidation in EMEA during the twelve month period ended September 30, 2019.

Income tax adjustment to diluted EPS is to exclude the impact of adjusting the valuation allowance against deferred taxes and other tax related items in order to reflect a normalized ongoing effective tax rate of 25.0% for the three and twelve month periods ended September 30, 2020 and September 30, 2019 based upon enacted corporate tax rate in the United States.

SPECTRUM BRANDS HOLDINGS, INC.

OTHER SUPPLEMENTAL INFORMATION (Unaudited)

ADJUSTED DILUTED EPS(continued)

The following is a reconciliation of reported diluted EPS from continuing operations to adjusted diluted EPS from continuing operations for the three and twelve month periods ended September 30, 2020 and September 30, 2019.

	Three Month Periods Ended				Twelve Month Periods Ended
	September 30, 2020		September 30, 2019		September 30, 2020		September 30, 2019
Diluted EPS from continuing operations, as reported	$	1.01	$	(1.62)	$	1.87	$	(3.71)
Adjustments:
Restructuring and related charges	0.25		0.48		1.62		1.30
Transaction related charges	0.13		0.11		0.51		0.43
Debt refinancing costs	—		0.09		0.06		1.09
Loss (Gain) on Energizer investment	0.20		(0.53)		0.38		0.24
Loss on assets held for sale	—		—		0.60		—
Write-off from impairment of goodwill	—		2.38		—		2.29
Write-off from impairment of intangible assets	—		0.73		0.54		0.70
Foreign currency change on multicurrency divestiture loans	(0.03)		0.14		0.09		0.71
Legal and environmental reserves	—		0.21		—		0.20
Salus	—		0.01		0.01		0.03
Salus CLO debt extinguishment	—		—		(1.70)		—
GPC safety recall	—		—		—		0.01
Depreciation & amortization on HPC long-lived assets	—		—		—		0.57
Other	(0.09)		0.04		(0.09)		0.10
Income tax adjustment	0.25		(0.91)		0.21		(1.10)
Total adjustments	0.71		2.75		2.23		6.57
Diluted EPS from continuing operations, as adjusted	$	1.72	$	1.13	$	4.10	$	2.86

SPECTRUM BRANDS HOLDINGS, INC.

OTHER SUPPLEMENTAL INFORMATION (Unaudited)

ADJUSTED DILUTED EPS(continued)

The following summarizes transaction related charges for the three and twelve month periods ended September 30, 2020 and September 30, 2019:

	Three Month Periods Ended				Twelve Month Periods Ended
(in millions)	September 30, 2020		September 30, 2019		September 30, 2020		September 30, 2019
Coevorden operations divestiture	$	2.1	$	—	$	5.5	$	—
GBL post divestiture separation	2.6		3.6		10.2		9.5
HPC divestiture	0.3		1.2		3.9		7.3
Omega Sea acquisition	0.1		—		1.6		—
Other integration	0.6		0.6		1.9		5.0
Total transaction-related charges	$	5.7	$	5.4	$	23.1	$	21.8

The following summarizes restructuring and related charges for the three and twelve month periods ended September 30, 2020 and September 30, 2019:

	Three Month Periods Ended				Twelve Month Periods Ended
(in millions)	September 30, 2020		September 30, 2019		September 30, 2020		September 30, 2019
Global productivity improvement program	$	11.5	$	22.8	$	71.6	$	60.9
HHI distribution center consolidation	—		—		—		2.3
Other restructuring activities	(0.5)		0.7		1.0		2.5
Total restructuring and related charges	$	11.0	$	23.5	$	72.6	$	65.7

NET SALES AND ORGANIC NET SALES

The following is a summary of net sales by segment for the three and twelve month periods ended September 30, 2020 and September 30, 2019:

	Three Month Periods Ended							Twelve Month Periods Ended
(in millions, except %)	September 30, 2020		September 30, 2019		Variance			September 30, 2020		September 30, 2019		Variance
HHI	$	433.7	$	364.9	68.8	18.9	%	$	1,342.1	$	1,355.7	(13.6)	(1.0)	%
HPC	302.3		285.8		16.5	5.8	%	1,107.6		1,068.1		39.5	3.7	%
GPC	278.3		228.9		49.4	21.6	%	962.6		870.2		92.4	10.6	%
H&G	156.3		113.4		42.9	37.8	%	551.9		508.1		43.8	8.6	%
Net Sales	$	1,170.6	$	993.0	177.6	17.9	%	$	3,964.2	$	3,802.1	162.1	4.3	%

We define organic net sales as reported net sales excluding the effect of changes in foreign currency exchange rates and acquisitions. We believe this non-GAAP measure provides useful information to investors because it reflects regional and operating segment performance from our activities without the effect of changes in currency exchange rate and/or acquisitions. We use organic net sales as one measure to monitor and evaluate our regional and segment performance. Organic growth is calculated by comparing organic net sales to reported net sales in the prior year. The effect of changes in currency exchange rates is determined by translating the period’s net sales using the currency exchange rates that were in effect during the prior period. Net sales are attributed to the geographic regions based on the country of destination. We exclude net sales from acquired businesses in the current year for which there are no comparable sales in the prior period. The following is a reconciliation of reported sales to organic sales for the three and twelve month periods ended September 30, 2020 compared to reported net sales for the three and twelve month periods ended September 30, 2019:

	September 30, 2020
Three Month Periods Ended (in millions, except %)	Net Sales		Effect of Changes in Currency		Net Sales Excluding Effect of Changes in Currency		Effect of Acquisitions		Organic Net Sales		Net Sales September 30, 2019		Variance
HHI	$	433.7	$	(0.5)	$	433.2	$	—	$	433.2	$	364.9	$	68.3	18.7	%
HPC	302.3		(0.5)		301.8		—		301.8		285.8		16.0		5.6	%
GPC	278.3		(3.2)		275.1		(3.8)		271.3		228.9		42.4		18.5	%
H&G	156.3		—		156.3		—		156.3		113.4		42.9		37.8	%
Total	$	1,170.6	$	(4.2)	$	1,166.4	$	(3.8)	$	1,162.6	$	993.0	$	169.6	17.1	%

	September 30, 2020
Twelve Month Periods Ended (in millions, except %)	Net Sales		Effect of Changes in Currency		Net Sales Excluding Effect of Changes in Currency		Effect of Acquisitions		Organic Net Sales		Net Sales September 30, 2019		Variance
HHI	$	1,342.1	$	0.4	$	1,342.5	$	—	$	1,342.5	$	1,355.7	$	(13.2)	(1.0)	%
HPC	1,107.6		18.9		1,126.5		—		1,126.5		1,068.1		58.4		5.5	%
GPC	962.6		1.1		963.7		(7.5)		956.2		870.2		86.0		9.9	%
H&G	551.9		0.1		552.0		—		552.0		508.1		43.9		8.6	%
Total	$	3,964.2	$	20.5	$	3,984.7	$	(7.5)	$	3,977.2	$	3,802.1	$	175.1	4.6	%

ADJUSTED EBITDAANDADJUSTED EBITDA MARGIN

Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, Amortization) is a non-GAAP metric used by management that we believe provides useful information to investors because it reflects ongoing operating performance and trends of our segments excluding certain non-cash based expenses and/or non-recurring items during each of the comparable periods and facilitates comparisons between peer companies since interest, taxes, depreciation and amortization can differ greatly between organizations as a result of differing capital structures and tax strategies. Further, adjusted EBITDA is a measure used for determining the Company’s debt covenant. EBITDA is calculated by excluding the Company’s income tax expense, interest expense, depreciation expense and amortization expense (from intangible assets) from net income. Adjusted EBITDA further excludes the following:

Stock based and other incentive compensation costs that consist of costs associated with long-term compensation arrangements and other equity based compensation based upon achievement of long-term performance metrics; and generally consist of non-cash, stock-based compensation. During the year ending September 30, 2019, the Company issued certain incentive bridge awards due to changes in the Company’s long-term compensation plans that allow for cash based payment upon employee election which have been included in the adjustment but do not qualify for shared-based compensation;
Restructuring and related charges, which consist of project costs associated with the restructuring initiatives across the Company’s segments;
Transaction related charges that consist of (1) transaction costs from qualifying acquisition transactions during the period, or subsequent integration related project costs directly associated with an acquired business; and (2) divestiture related transaction costs that are recognized in continuing operations and post-divestiture separation costs consisting of incremental costs to facilitate separation of shared operations, including development of transferred shared service operations, platforms and personnel transferred as part of the divestitures and exiting of transition service arrangements (TSAs) and reverse TSAs;
Gains and losses attributable to the Company’s investment in Energizer common stock, acquired as part of consideration received from the Company’s sale and divestiture of GAC during the year ended September 30, 2019;
Non-cash purchase accounting inventory adjustments recognized in earnings from continuing operations subsequent to an acquisition (when applicable);
Non-cash asset impairments or write-offs realized and recognized in earnings from continuing operations (when applicable);
Foreign currency gains and losses attributable to multicurrency loans for the three and twelve month periods ended September 30, 2020 and September 30, 2019, that were entered into with foreign subsidiaries in exchange for receipt of divestiture proceeds by the parent company and the distribution of the respective foreign subsidiaries’ net assets as part of the GBL and GAC divestitures during the year ended September 30, 2019. The Company has entered into various hedging arrangements to mitigate the volatility of foreign exchange risk associated with such loans;
Legal and litigation costs associated with Salus during the three and twelve month periods ended September 30, 2020 and September 30, 2019 as they are not considered a component of the continuing commercial products company, but continue to be consolidated by the Company until the Salus operations can be wholly dissolved and/or deconsolidated;
Gain on extinguishment of the Salus CLO debt due to the discharge of the obligation during the twelve month period ended September 30, 2020; and
Other adjustments primarily consisting of costs attributable to (1) expenses and cost recovery for flood damage at Company facilities in Middleton, Wisconsin during the three and twelve month periods ended September 30, 2020 and September 30, 2019; (2) incremental costs for separation of a key executive during the three and twelve month periods ended September 30, 2020 and September 30, 2019; (3) incremental costs associated with a safety recall in GPC during the three and twelve month periods ended September 30, 2019; (4) operating margin on H&G sales to GAC discontinued operations during the three and twelve month period ended September 30, 2019; and (5) certain fines and penalties for delayed shipments following the completion of a GPC distribution center consolidation in EMEA during the twelve month period ended September 30, 2019.

Adjusted EBITDA margin is calculated as adjusted EBITDA as a percentage of reported net sales for the respective periods.

SPECTRUM BRANDS HOLDINGS, INC.

OTHER SUPPLEMENTAL INFORMATION (Unaudited)

ADJUSTED EBITDAAND ADJUSTED EBITDA MARGIN(continued)

The following is a reconciliation of reported net income (loss) from continuing operations to adjusted EBITDA for the three month periods ended September 30, 2020 and September 30, 2019, including the calculation of adjusted EBITDA margin for each of the respective periods.

Three Month Period Ended September 30, 2020 (in millions, except %)	HHI			HPC			GPC			H&G			Corporate		Consolidated
Net income from continuing operations	$	91.5		$	11.3		$	35.3		$	26.4		$	(120.7)	$	43.8
Income tax expense	—			—			—			—			35.6		35.6
Interest expense	—			—			—			—			38.0		38.0
Depreciation and amortization	8.8			8.8			9.3			5.0			3.6		35.5
EBITDA	100.3			20.1			44.6			31.4			(43.5)		152.9
Share and incentive based compensation	—			—			—			—			0.3		0.3
Restructuring and related charges	0.1			1.0			1.9			0.2			7.8		11.0
Transaction related charges	—			1.5			3.4			—			0.8		5.7
Loss on Energizer investment	—			—			—			—			8.7		8.7
Foreign currency loss on multicurrency divestiture loans	—			0.2			—			—			(1.3)		(1.1)
Other	—			(0.1)			—			(0.1)			(4.0)		(4.2)
Adjusted EBITDA	$	100.4		$	22.7		$	49.9		$	31.5		$	(31.2)	$	173.3
Net Sales	$	433.7		$	302.3		$	278.3		$	156.3		$	—	$	1,170.6
Adjusted EBITDA Margin	23.1		%	7.5		%	17.9		%	20.2		%	—		14.8		%

Three Month Period Ended September 30, 2019 (in millions, except %)	HHI			HPC			GPC			H&G			Corporate			Consolidated
Net income (loss) from continuing operations	$	69.1		$	(118.8)		$	6.1		$	14.1		$	(49.5)		$	(79.0)
Income tax benefit	—			—			—			—			(25.2)			(25.2)
Interest expense	—			—			—			—			37.0			37.0
Depreciation and amortization	8.3			8.9			16.8			4.9			3.5			42.4
EBITDA	77.4			(109.9)			22.9			19.0			(34.2)			(24.8)
Share and incentive based compensation	—			—			—			—			14.9			14.9
Restructuring and related charges	0.4			3.4			1.2			0.4			18.1			23.5
Transaction related charges	—			1.1			1.0			—			3.3			5.4
Gain on Energizer investment	—			—			—			—			(26.1)			(26.1)
Write-off from impairment of goodwill	—			116.0			—			—			—			116.0
Write-off from impairment of intangible assets	—			18.8			16.6			—			—			35.4
Foreign currency loss on multicurrency divestiture loans	—			—			—			—			6.7			6.7
Legal and environmental remediation reserves	—			—			—			—			10.0			10.0
Salus	—			—			—			—			0.4			0.4
Other	—			—			—			0.2			1.5			1.7
Adjusted EBITDA	$	77.8		$	29.4		$	41.7		$	19.6		$	(5.4)		$	163.1
Net Sales	$	364.9		$	285.8		$	228.9		$	113.4		$	—		$	993.0
Adjusted EBITDA Margin	21.3		%	10.3		%	18.2		%	17.3		%	—		%	16.4		%

SPECTRUM BRANDS HOLDINGS, INC.

OTHER SUPPLEMENTAL INFORMATION (Unaudited)

ADJUSTED EBITDAAND ADJUSTED EBITDA MARGIN(continued)

The following is a reconciliation of reported net income (loss) from continuing operations to adjusted EBITDA for the twelve month periods ended September 30, 2020 and September 30, 2019, including the calculation of adjusted EBITDA margin for each of the respective periods.

Twelve Month Period Ended September 30, 2020 (in millions, except for %)	HHI			HPC			GPC			H&G			Corporate		Consolidated
Net income from continuing operations	$	221.4		$	42.9		$	44.9		$	91.2		$	(315.9)	$	84.5
Income tax expense	—			—			—			—			70.9		70.9
Interest expense	—			—			—			—			144.5		144.5
Depreciation and amortization	33.9			35.2			44.4			20.4			14.6		148.5
EBITDA	255.3			78.1			89.3			111.6			(85.9)		448.4
Share and incentive based compensation	—			—			—			—			43.6		43.6
Restructuring and related charges	1.0			4.6			20.8			0.5			45.7		72.6
Transaction related charges	—			8.8			10.8			—			3.5		23.1
Loss on Energizer investment	—			—			—			—			16.8		16.8
Loss on assets held for sale	—			—			26.8			—			—		26.8
Write-off from impairment of intangible assets	—			—			24.2			—			—		24.2
Foreign currency loss on multicurrency divestiture loans	—			0.6			—			—			3.2		3.8
Salus	—			—			—			—			0.6		0.6
Salus CLO debt extinguishment	—			—			—			—			(76.2)		(76.2)
Other	—			0.1			0.1			—			(3.7)		(3.5)
Adjusted EBITDA	$	256.3		$	92.2		$	172.0		$	112.1		$	(52.4)	$	580.2
Net Sales	$	1,342.1		$	1,107.6		$	962.6		$	551.9		$	—	$	3,964.2
Adjusted EBITDA Margin	19.1		%	8.3		%	17.9		%	20.3		%	$	—	14.6		%

SPECTRUM BRANDS HOLDINGS, INC.

OTHER SUPPLEMENTAL INFORMATION (Unaudited)

ADJUSTED EBITDAAND ADJUSTED EBITDA MARGIN(continued)

Twelve Month Period Ended September 30, 2019 (in millions, except for %)	HHI			HPC			GPC			H&G			Corporate		Consolidated
Net income (loss) from continuing operations	$	214.6		$	(127.8)		$	63.4		$	84.9		$	(421.8)	$	(186.7)
Income tax benefit	—			—			—			—			(7.1)		(7.1)
Interest expense	—			—			—			—			222.1		222.1
Depreciation and amortization	33.5			64.6			48.8			19.3			14.6		180.8
EBITDA	248.1			(63.2)			112.2			104.2			(192.2)		209.1
Share and incentive based compensation	—			—			—			—			53.7		53.7
Restructuring and related charges	4.7			8.1			7.6			1.8			43.5		65.7
Transaction related charges	0.9			7.4			2.5			—			11.0		21.8
Loss on Energizer investment	—			—			—			—			12.1		12.1
Write-off from impairment of goodwill	—			116.0			—			—			—		116.0
Write-off from impairment of intangible assets	—			18.8			16.6			—			—		35.4
Foreign currency loss on multicurrency divestiture loans	—			—			—			—			36.2		36.2
Legal and environmental remediation reserves	—			—			—			—			10.0		10.0
GPC safety recall	—			—			0.7			—			—		0.7
Salus	—			—			—			—			1.6		1.6
Other	—			0.1			3.0			(0.5)			2.1		4.7
Adjusted EBITDA	$	253.7		$	87.2		$	142.6		$	105.5		$	(22.0)	$	567.0
Net Sales	$	1,355.7		$	1,068.1		$	870.2		$	508.1		$	—	$	3,802.1
Adjusted EBITDA Margin	18.7		%	8.2		%	16.4		%	20.8		%	—		14.9		%

SPECTRUM BRANDS HOLDINGS, INC.

OTHER SUPPLEMENTAL INFORMATION (Unaudited)

ADJUSTED EBITDAAND ADJUSTED EBITDA MARGIN(continued)

Compensation Program Change

During the fourth quarter ended September 30, 2020, the Company made a change to its annual management incentive plans (“MIP”) payout that previously provided for the issuance of stock for a designated pool of recipients in lieu of cash. The annual MIP payout will instead be fully funded through cash distributions with no stock issuance. Our operating performance metric of Adjusted EBITDA excludes any consideration for stock-based compensation expense. Due to the change in the form of payout, there was a reduction to our stock-based compensation and adjusted EBITDA for the three month and fiscal year ended September 30, 2020 of $17.0 million. For comparative purposes for the three month period and year ended September 30, 2020 respective of the prior period, we have included the following pro forma adjusted EBITDA results for the fiscal fourth quarter and year ended September 30, 2020. The following table reflects the pro forma compensation program change as if the $17.0 million was paid in stock and excluded from Adjusted EBITDA consistent to the prior period.

Three month period ended September 30, 2020 (in millions)	HHI		HPC		GPC		H&G		Corporate		Consolidated
Adjusted EBITDA	$	100.4	$	22.7	$	49.9	$	31.5	$	(31.2)	$	173.3
Proforma compensation program change	—		—		—		—		17.0		17.0
Proforma Adjusted EBITDA	$	100.4	$	22.7	$	49.9	$	31.5	$	(14.2)	$	190.3
Twelve month period ended September 30, 2020 (in millions)	HHI		HPC		GPC		H&G		Corporate		Consolidated
Adjusted EBITDA	$	256.3	$	92.2	$	172.0	$	112.1	$	(52.4)	$	580.2
Proforma compensation program change	—		—		—		—		17.0		17.0
Proforma Adjusted EBITDA	$	256.3	$	92.2	$	172.0	$	112.1	$	(35.4)	$	597.2

The Company has historically recognized all stock based compensation as a corporate cost and continued to do so for purposes of reporting adjusted EBITDA within the consolidated group. With the compensation program change described above, the Company maintained the compensation expense as a component of Corporate within the quarter and did not reflect the incremental change in the Segment EBITDA above.

SPECTRUM BRANDS HOLDINGS, INC.

OTHER SUPPLEMENTAL INFORMATION (Unaudited)

ADJUSTED EBITDAAND ADJUSTED EBITDA MARGIN(continued)

Compensation Program Change (continued)

The program change is expected to continue into fiscal 2021 and beyond. Any MIP payouts in future periods are expected to be paid in cash and reflected as a reduction to EBITDA and Adjusted EBITDA. Beginning in fiscal 2021, the Company will recognize a portion of the MIP compensation as a component of the segment EBITDA which may impact comparability of segment results in subsequent quarterly results during the fiscal year ending September 30, 2021. Although not expected to be material to operating results in future periods, we have included proforma financial information below to reflect the compensation charge related to the compensation program change as if it were not considered stock compensation at the beginning of 2020 fiscal year and have allocated it to the segment EBITDA for each of the quarterly and year-to-date periods within the year ended September 30, 2020 for comparability in subsequent future reporting periods.

Three month period ended December 29, 2019

Three month period ended (in millions)	HHI		HPC		GPC		H&G		Corporate		Consolidated
Adjusted EBITDA	$	42.8	$	36.4	$	31.5	$	(3.3)	$	(5.2)	$	102.2
Proforma compensation program change	(0.6)		(0.4)		(0.4)		(0.2)		(2.6)		(4.2)
Proforma Adjusted EBITDA	$	42.2	$	36.0	$	31.1	$	(3.5)	$	(7.8)	$	98.0

Three and six month periods ended March 29, 2020

Three month period ended (in millions)	HHI		HPC		GPC		H&G		Corporate		Consolidated
Adjusted EBITDA	$	69.5	$	8.0	$	40.0	$	28.4	$	(5.5)	$	140.4
Proforma compensation program change	(0.6)		(0.4)		(0.4)		(0.3)		(2.6)		(4.3)
Proforma Adjusted EBITDA	$	68.9	$	7.6	$	39.6	$	28.1	$	(8.1)	$	136.1
Six month period ended (in millions)	HHI		HPC		GPC		H&G		Corporate		Consolidated
Adjusted EBITDA	$	112.3	$	44.4	$	71.5	$	25.1	$	(10.8)	$	242.5
Proforma compensation program change	(1.3)		(0.8)		(0.7)		(0.5)		(5.2)		(8.5)
Proforma Adjusted EBITDA	$	111.0	$	43.6	$	70.8	$	24.6	$	(16.0)	$	234.0

Three and nine month periods ended June 28, 2020

Three month period ended (in millions)	HHI		HPC		GPC		H&G		Corporate		Consolidated
Adjusted EBITDA	$	43.6	$	25.0	$	50.6	$	55.5	$	(10.3)	$	164.4
Proforma compensation program change	(0.6)		(0.4)		(0.4)		(0.2)		(2.7)		(4.3)
Proforma Adjusted EBITDA	$	43.0	$	24.6	$	50.2	$	55.3	$	(13.0)	$	160.1
Nine month period ended (in millions)	HHI		HPC		GPC		H&G		Corporate		Consolidated
Adjusted EBITDA	$	156.0	$	69.4	$	122.1	$	80.6	$	(21.1)	$	407.0
Proforma compensation program change	(1.8)		(1.2)		(1.1)		(0.7)		(7.9)		(12.7)
Proforma Adjusted EBITDA	$	154.2	$	68.2	$	121.0	$	79.9	$	(29.0)	$	394.3

Three month period and year ended September 30, 2020

Three month period ended (in millions)	HHI		HPC		GPC		H&G		Corporate		Consolidated
Adjusted EBITDA	$	100.4	$	22.7	$	49.9	$	31.5	$	(31.2)	$	173.3
Proforma compensation program change	(1.4)		(1.0)		(1.2)		(0.7)		17.0		12.7
Proforma Adjusted EBITDA	$	99.0	$	21.7	$	48.7	$	30.8	$	(14.2)	$	186.0
Twelve month period ended (in millions)	HHI		HPC		GPC		H&G		Corporate		Consolidated
Adjusted EBITDA	$	256.3	$	92.2	$	172.0	$	112.1	$	(52.4)	$	580.2
Proforma compensation program change	(3.2)		(2.2)		(2.3)		(1.5)		9.2		—
Proforma Adjusted EBITDA	$	253.1	$	90.0	$	169.7	$	110.6	$	(43.2)	$	580.2

ADJUSTED FREE CASH FLOW

The following is a reconciliation of net cash flow from operating activities to adjusted free cash flow for the year ended September 30, 2020 and forecasted adjusted free cash flow for the year ending September 30, 2021.

(in millions)	September 30, 2020		September 30, 2021
Net cash flow from operating activities	$	290	310 – 330
Purchases of property, plant and equipment	(61)		(85) – (95)
Divestiture related separation costs and taxes	25		25 – 35
Adjusted free cash flow	$	254	250 – 270

View source version on businesswire.com: https://www.businesswire.com/news/home/20201113005127/en/

Investor/Media Contact:

Kevin Kim608-278-6148

KEYWORDS: Wisconsin United States North America

INDUSTRY KEYWORDS: Home Goods Retail Specialty

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November 13, 2020 6:33 am

Magellan Rx Management Releases Fifth Annual Medicaid Pharmacy Trend Report

Magellan Rx Management Releases Fifth Annual Medicaid Pharmacy Trend Report

PHOENIX–(BUSINESS WIRE)–Magellan Rx Management, the full-service pharmacy benefits management division of Magellan Health, Inc. (NASDAQ: MGLN), released its fifth annual Medicaid Pharmacy Trend Report^TM, the industry’s leading report exclusively detailing trends in the Medicaid pharmacy fee-for-service (FFS) space and the only detailed source examining Medicaid FFS gross and net drug spend trends.

“As a national leader in pharmacy benefit management, with more than 40 years of experience, we maintain a deep understanding of the complexities within the Medicaid space related to prescription drug costs and utilization trends,” said Meredith Delk, PhD, MSW, general manager and senior vice president, government markets, Magellan Rx Management. “The Medicaid Trend Report is one tool of many we deploy that provides value to our more than 25 government customers and Medicaid agencies across the country. We are delighted to release it for the fifth consecutive year.”

Developed through in-depth data analysis and supported by Magellan’s broad national experience managing Medicaid FFS pharmacy, the Medicaid Pharmacy Trend Report highlights the evolving landscape of Medicaid prescription drugs and anticipates the trends and challenges in the Medicaid FFS space. The report also now includes a standard in-depth analysis of the top drug classes including six additional categories that provide a superior overview of classes with significant net dollar impact.

Key findings in this year’s report include:

In 2019, specialty drugs accounted for 48.5 percent of net cost in Medicaid while making up just 1.3 percent of utilization.
Traditional net spending on drugs decreased 0.4 percent from 2018 to 2019.
Unit cost, not utilization, drove specialty trend in 2019. The net cost per claim increased by $141.12, while utilization decreased by 0.9 percent.
While claim volume remains virtually unchanged, the total net spend on specialty drugs increased by 2.4 percent which indicates that specialty drugs will account for 50 percent of total net spend for 2020.

“States are faced with inherent challenges related to the variability in the Medicaid program due to fluctuations in enrollment, enabling legislation and pharmacy program design,” said Chris Andrews, Pharm.D., vice president, value-based purchasing, Magellan Rx Management. “The Medicaid Trend Report clearly illustrates critical data-driven observations and helpful solutions that can assist states as they continue to explore and implement efforts to balance the growing cost of state Medicaid programs with state budget projections as they focus on achieving improved outcomes for Medicaid patients.”

The Magellan Rx Management Medicaid Pharmacy Trend Report includes data derived from Magellan Rx’s Medicaid FFS pharmacy programs in 25 states and the District of Columbia.

About Magellan Rx Management: Magellan Rx Management, a division of Magellan Health, Inc., is shaping the future of pharmacy. As a next-generation pharmacy organization, we deliver meaningful solutions to the people we serve. As pioneers in specialty drug management, industry leaders in Medicaid pharmacy programs and disruptors in pharmacy benefit management, we partner with our customers and members to deliver a best-in-class healthcare experience.

About Magellan Health: Magellan Health, Inc., a Fortune 500 company, is a leader in managing the fastest growing, most complex areas of health, including special populations, complete pharmacy benefits and other specialty areas of healthcare. Magellan supports innovative ways of accessing better health through technology, while remaining focused on the critical personal relationships that are necessary to achieve a healthy, vibrant life. Magellan’s customers include health plans and other managed care organizations, employers, labor unions, various military and governmental agencies and third-party administrators. For more information, visit MagellanHealth.com.

(MGLN-GEN)

View source version on businesswire.com: https://www.businesswire.com/news/home/20201113005178/en/

Media Contact: Lilly Ackley, [email protected], (860) 507-1923

Investor Contact: Darren Lehrich, [email protected], (860) 507-1814

KEYWORDS: United States North America Arizona

INDUSTRY KEYWORDS: Mental Health Health Consumer Seniors Managed Care Pharmaceutical Biotechnology

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November 13, 2020 6:33 am

NICE inContact Named a Cloud Contact Center Leader by Gartner

NICE inContact Named a Cloud Contact Center Leader by Gartner

NICE inContact positioned highest for Ability to Execute in the Leaders quadrant of the Gartner 2020 Magic Quadrant for Contact Center as a Service

SALT LAKE CITY–(BUSINESS WIRE)–NICE inContact, a NICEbusiness (Nasdaq: NICE), today announced that Gartner has recognized the company as a Leader in the 2020 Gartner Magic Quadrant for Contact Center as a Service (CCaaS) report. The company was positioned the highest overall for its ability to execute.

This Gartner 2020 Magic Quadrant evaluates CCaaS providers that can serve customers around the globe. This is the first year the Magic Quadrant has evaluated vendors in one global report, assessing providers based on global execution and vision. This Magic Quadrant provides the following quadrant description for Leaders: “Leaders are best described as suppliers with strong support for the four pillars of great customer service, and with an ability to serve multinational organizations with local sales and support organizations. Leaders are more likely to serve customers through channel partners and have strong brand recognition, which has resulted in a large installed base or above-average market growth as a result of customer demand. Leaders also benefit from being able to support varying levels of deployment complexity, including integrations with partners through established marketplaces.”

NICE inContact serves companies of all sizes with its cloud customer experience platform, CXone, fueling exceptional experiences for both customers and agents by unifying Customer Analytics, Omnichannel Routing, Workforce Engagement Management, and Automation & Artificial Intelligence. CXone supports more than 500,000 agents in the cloud in more than 100 countries.

According to the Gartner report, “CCaaS solutions are largely systems of differentiation.” The report continues, “we know from market surveys that customers can achieve a better customer experience in the digital channel. Organizations that wish to capitalize on this will shift their customer service strategy to focus on providers that offer a digital-first customer service proposition. Emerging providers with a digital first proposition offer an alternative approach to upgrading from legacy customer-premises equipment.”

The report notes that “2020 has been a catalytic year for cloud services, with the COVID-19 pandemic triggering organizations to rethink their customer service strategies — initially to incorporate remote working, and subsequently digital agility and cost optimization initiatives. Most CCaaS providers have experienced strong demand for their services through 2020, as organizations uncover inherent inflexibility in premises-based contact center platforms or, simply, they have been unable to cope with sudden increases in contact volumes. Through the pandemic, CCaaS providers have demonstrated their agility and flexibility to rapidly deliver new services such that we expect CCaaS will dominate contact center decision making from this year forward.”

The report also states that “by 2024, contact center as a service (CCaaS) solutions that include functionality from all four pillars of customer service technology will represent 70% of all new CCaaS deployments, up from 20% in 2019.”

“To us, this recognition from Gartner is a tremendous accomplishment, and it reinforces that NICE inContact is committed to the four pillars of great customer service, leading the market with innovative solutions to help organizations around the world, both large and small, modernize and remain agile to keep pace with customers’ growing demands in today’s digital world,” said Paul Jarman, NICE inContact CEO. “The digital age has transformed the way customers interact with brands, leading to CCaaS solutions growing increasingly popular globally. We have proven success with customers across a broad range of company sizes and verticals around the globe because we not only have a vision for continued innovation but most importantly because we have a demonstrated track record of executing to deliver the capabilities, reliability, scale and services businesses need to achieve their goals.”

In 2020, managing a remote workforce became imperative for preserving customer relationships with continuous service. CXone provides remote workforce agility with an advanced workforce engagement suite as part of the unified, cloud native CXone platform, enabling contact centers to avoid disruptions and to continuously manage productivity and agent performance in any location.

Companies that want to provide extraordinary customer experiences and continuously innovate based on customer insights can also benefit from the advanced analytics in CXone with the tools to understand topics and trends and to drive measurable improvements across the omnichannel experience that their customers receive.

To read the full complimentary copy of the Gartner report, click here.

Gartner Magic Quadrant for Contact Center as a Service, 9 November 2020, Steve Blood, Drew Kraus, Pri Rathnayake.

Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner’s research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

About NICE inContact

NICE inContact works with organizations of all sizes to create extraordinary and trustworthy customer experiences that create deeper brand loyalty and relationships that last. With NICE inContact CXone^TM, the industry’s most complete cloud customer experience platform, we combine best-in-class Customer Analytics, Omnichannel Routing, Workforce Engagement, Automation and Artificial Intelligence, all on an Open Cloud Foundation to help any company transform every single customer interaction. See how our customer-centric expert services, innovative software, extensive ecosystem of valuable partnerships, and over a decade of global experience can help you transform every experience and customer relationship for lasting results. NICE inContact is recognized as a market leader by the leading industry analyst firms. www.niceincontact.com

NICE (Nasdaq: NICE) is the world’s leading provider of both cloud and on-premises enterprise software solutions that empower organizations to make smarter decisions based on advanced analytics of structured and unstructured data. NICE helps organizations of all sizes deliver better customer service, ensure compliance, combat fraud and safeguard citizens. Over 25,000 organizations in more than 150 countries, including over 85 of the Fortune 100 companies, are using NICE solutions. www.nice.com

Trademark Note: NICE and the NICE logo are trademarks or registered trademarks of NICE Ltd. All other marks are trademarks of their respective owners. For a full list of NICE’s marks, please see: www.nice.com/nice-trademarks.

Forward-Looking Statements

This press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements, including the statements by Mr. Jarman, are based on the current beliefs, expectations and assumptions of the management of NICE Ltd. (the “Company”). In some cases, such forward-looking statements can be identified by terms such as “believe,” “expect,” “seek,” “may,” “will,” “intend,” “should,” “project,” “anticipate,” “plan,” “estimate,” or similar words. Forward-looking statements are subject to a number of risks and uncertainties that could cause the actual results or performance of the Company to differ materially from those described herein, including but not limited to the impact of changes in economic and business conditions, including as a result of the COVID-19 pandemic; competition; successful execution of the Company’s growth strategy; success and growth of the Company’s cloud Software-as-a-Service business; changes in technology and market requirements; decline in demand for the Company’s products; inability to timely develop and introduce new technologies, products and applications; difficulties or delays in absorbing and integrating acquired operations, products, technologies and personnel; loss of market share; an inability to maintain certain marketing and distribution arrangements; the Company’s dependency on third-party cloud computing platform providers, hosting facilities and service partners; cyber security attacks or other security breaches against the Company; the effect of newly enacted or modified laws, regulation or standards on the Company and our products and various other factors and uncertainties discussed in our filings with the U.S. Securities and Exchange Commission (the “SEC”). For a more detailed description of the risk factors and uncertainties affecting the company, refer to the Company’s reports filed from time to time with the SEC, including the Company’s Annual Report on Form 20-F. The forward-looking statements contained in this press release are made as of the date of this press release, and the Company undertakes no obligation to update or revise them, except as required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20201113005080/en/

Corporate Media Contact

Cheryl Andrus, +1 801 320 3646, [email protected], ET

Investors

Marty Cohen, +1 551 256 5354, [email protected], ET

Yisca Erez +972 9 775 3798, [email protected], CET

KEYWORDS: Utah United States North America

INDUSTRY KEYWORDS: Software Networks Internet Hardware Data Management Consumer Electronics Technology Other Technology

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November 13, 2020 6:13 am

GRAVITY REPORTS THIRD QUARTER OF 2020 RESULTS AND BUSINESS UPDATES

Seoul, South Korea, Nov. 13, 2020 (GLOBE NEWSWIRE) — GRAVITY Co., Ltd. (Nasdaq GM: GRVY) (“Gravity” or “Company”), a developer and publisher of online and mobile games based in South Korea, today announced its unaudited financial results for the third quarter ended September 30, 2020, prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board and business updates.

THIRD QUARTER 2020 HIGHLIGHTS

Total revenues were KRW 131,795 million (US$ 113,034 thousand), representing a 49.0% increase from the second quarter ended June 30, 2020 (“QoQ”) and a 69.9% increase from the third quarter ended September 30, 2019 (“YoY”).
Operating profit was KRW 34,356 million (US$ 29,465 thousand), representing a 110.6% increase QoQ and a 236.0% increase YoY.
Profit before income tax expenses was KRW 33,675 million (US$ 28,881 thousand), representing a 106.2% increase QoQ and a 200.3% increase YoY.
Net profit attributable to parent company was KRW 25,281 million (US$ 21,682 thousand), representing a 93.1% increase QoQ and a 182.4% increase YoY.

REVIEW OF THIRD QUARTER 2020 FINANCIAL RESULTS

Revenues

Subscription revenues for the third quarter of 2020 were KRW 29,159 million (US$ 25,008 thousand), representing a 19.3% increase QoQ from KRW 24,448 million and a 176.0% increase YoY from KRW 10,564 million. The increase QoQ was mainly attributable to increased revenues from Ragnarok Online in Thailand that was re-launched on May 28, 2020 and Brazil. Such increase was partially offset by decreased revenues from Ragnarok H5 in Indonesia and Ragnarok Online in Taiwan. The increase YoY was largely due to increased revenues from Ragnarok Online in Thailand and United States.

Royalty and license fee revenues for the third quarter of 2020 were KRW 2,674 million (US$ 2,293 thousand), representing a 40.0% decrease QoQ from KRW 4,459 million and a 3.5% increase YoY from KRW 2,583 million. The decrease QoQ was primarily due to temporarily generated revenue from collaboration event with Garena’s Free Fire items based on Ragnarok Online IP in previous quarter. The increase YoY resulted mainly from increased revenue from Ragnarok Online in Japan. Such increase was partially offset by decreased revenue from Ragnarok Online in Thailand.

Mobile game revenues were KRW 95,531 million (US$ 81,933 thousand) for the third quarter of 2020, representing a 76.1% increase QoQ from KRW 54,249 million and a 59.0% increase YoY from KRW 60,086 million. The increase QoQ resulted primarily from increased revenues from Ragnarok Origin in Korea that was launched on July 7, 2020 and Ragnarok M: Eternal Love in Southeast Asia. Such increase was partially offset by decreased revenues from Ragnarok Tactics in Korea and Taiwan,Ragnarok H5 in Indonesia, and Ragnarok M: Eternal Love in Korea and Taiwan. The increase YoY was primarily due to revenues from Ragnarok Origin in Korea that was launched on July 7, 2020, Ragnarok M: Eternal Love in Taiwan. This increase was partially offset by decreased revenues from Ragnarok M: Eternal Love in Japan, Southeast Asia, North America, South America and Oceania, and Korea.

Other revenues were KRW 4,431 million (US$ 3,800 thousand) for the third quarter of 2020, representing a 16.4% decrease QoQ from KRW 5,302 million and a 2.3% increase YoY from KRW 4,333 million

Cost of Revenues

Cost of revenue was KRW 74,107 million (US$ 63,558 thousand) for the third quarter of 2020, representing a 45.0% increase QoQ from KRW 51,098 million and a 32.2% increase YoY from KRW 56,058 million. The increase QoQ was mainly due to increased commission paid for mobile game services related to Ragnarok Origin in Korea that was launched on July 7, 2020. The increase YoY was mostly from increased commission paid for mobile game services related to Ragnarok Origin in Korea that was launched on July 7, 2020.

Operating Expenses

Operating expenses were KRW 23,332 million (US$ 20,011 thousand) for the third quarter of 2020, representing a 10.9% increase QoQ from KRW 21,047 million and a 106.8% increase YoY from KRW 11,282 million. The increase QoQ was mainly attributable to increased research and development expenses and commission paid for payment gate way fees related to Ragnarok Online in Thailand. The increase YoY was mostly resulted from increased advertising expenses for Ragnarok Origin in Korea, commission paid for payment gate way fees related to Ragnarok Online in Thailand, research and development expenses, and salaries.

Profit before income tax expenses

Profit before income tax expenses was KRW 33,675 million (US$ 28,881 thousand) for the third quarter of 2020 compared with profit before income tax expense of KRW 16,335 million for the second quarter of 2020 and profit before income tax expenses of KRW 11,213 million for the third quarter of 2019.

Net Profit

As a result of the foregoing factors, Gravity recorded a net profit attributable to parent company of KRW 25,281 million (US$ 21,682 thousand) for the third quarter of 2020 compared with net profit attributable to parent company of KRW 13,095 million for the second quarter of 2020 and a net profit attributable to parent company of KRW 8,952 million for the third quarter of 2019.

Liquidity

The balance of cash and cash equivalents and short-term financial instruments was KRW 171,800 million (US$ 147,345 thousand) as of September 30, 2020.

Note: For convenience purposes only, the KRW amounts have been expressed in U.S. dollars at the exchange rate of KRW 1,165.97 to US$ 1.00, the noon buying rate in effect on September 30, 2020 as quoted by the Federal Reserve Bank of New York.

GRAVITY BUSINESS UPDATE

Ragnarok Online

IP-based Games

Ragnarok Origin, a MMORPG mobile game

Ragnarok Origin was launched in Korea on July 7, 2020 and is being prepared for launch in Japan in 1^st half of 2021.

Ragnarok X: Next Generation, a MMORPG mobile game

Ragnarok X: Next Generation was launched in Taiwan, Hong Kong and Macau on October 15, 2020 and is being prepared for launch in Southeast Asia in 1^st half of 2021.

The Labyrinth of Ragnarok, an Idle MMORPG mobile game

The Labyrinth of Ragnarok was launched in Philippines, Singapore and Malaysia on October 14, 2020. This game is being prepared for launch in Thailand and Indonesia in December 2020.

Other Ragnarok Online IP-based games

The Lost Memories: a Song of Valkyrie, a Story RPG mobile game, is expected to be launched in Thailand in 1^st half of 2021. The game was developed by NeoCyon, Inc., our subsidiary in Korea.

Action RO2: Spear of Odin, a 3D Action MORPG mobile game, is expected to be launched in Indonesia, Malaysia, Philippines, Singapore and Australia in 1^st half of 2021. The game was developed by NeoCyon, Inc., our subsidiary in Korea.

Other IP games

Tactical Warfare, a First-Person Shooter (FPS) game, has started pre-registration and will be launched in North, Central and South America in the fourth quarter of 2020. The game is published by Gravity Interactive, Inc., a subsidiary in the United States.

Tera Classic, a MMORPG mobile game, has started pre-registration and will be launched in Japan in January 2021. The game is published by Gravity Game Arise, Inc., a subsidiary in Japan.

Investor Presentation

Gravity issued an investor presentation. The presentation contains the Company’s recent business updates, results of third quarter in 2020 and Gravity’s business plan. The presentation can be found on the Company’s website under the IR Archives section at http://www.gravity.co.kr/en/ir/pds/list.asp. Korean and Japanese versions of the presentation are also provided on the website.

About GRAVITY Co., Ltd. —————————————————

Based in Korea, Gravity is a developer and publisher of online and mobile games. Gravity’s principal product, Ragnarok Online, is a popular online game in many markets, including Japan and Taiwan, and is currently commercially offered in 93 markets and countries. For more information about Gravity, please visit http://www.gravity.co.kr.

Forward-Looking Statements:

Certain statements in this press release may include, in addition to historical information, “forward-looking statements” within the meaning of the “safe-harbor” provisions of the U.S. Private Securities Litigation Reform Act 1995. Forward-looking statements can generally be identified by the use of forward-looking terminology, such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe”, “project,” or “continue” or the negative thereof or other similar words, although not all forward-looking statements contain these words. Investors should consider the information contained in our submissions and filings with the United States Securities and Exchange Commission (the “SEC”), including our annual report for the fiscal year ended December 31, 2019 on Form 20-F, together with such other documents that we may submit to or file with the SEC from time to time, on Form 6-K. The forward-looking statements speak only as of this press release and we assume no duty to update them to reflect new, changing or unanticipated events or circumstances.

Contact:

Mr. Heung Gon Kim
Chief Financial Officer
Gravity Co., Ltd.
Email: [email protected]

Ms. Jin Lee
Ms. Hye Ji An
IR Unit
Gravity Co., Ltd.
Email: [email protected]
Telephone: +82-2-2132-7800

# # #

GRAVITY Co., Ltd.

Consolidated Statements of Financial Position

(In millions of KRW and thousands of US$)

	As of
	31-Dec-19				30-Sep-20
	KRW		US$		KRW		US$
	(audited)		(unaudited)		(unaudited)		(unaudited)
Assets
Current assets:
Cash and cash equivalents		79,428		68,122		116,800		100,174
Short-term financial instruments		39,500		33,877		55,000		47,171
Accounts receivable, net		32,253		27,662		55,570		47,660
Other receivables, net		56		48		0		0
Prepaid expenses		1,962		1,683		2,782		2,386
Other current assets		2,664		2,285		1,137		975
Total current assets		155,863		133,677		231,289		198,366
Property and equipment, net		6,663		5,715		7,201		6,176
Intangible assets		1,717		1,473		1,733		1,486
Deferred tax assets		7,667		6,576		7,885		6,763
Other non-current financial assets		1,770		1,518		1,777		1,524
Other non-current assets		1,745		1,494		5,255		4,508
Total assets		175,425		150,453		255,140		218,823
Liabilities and Equity
Current liabilities:
Accounts payable		37,496		32,159		56,668		48,602
Deferred revenue		10,748		9,218		15,194		13,031
Withholdings		1,764		1,513		3,463		2,970
Accrued expense		1,175		1,008		1,182		1,014
Income tax payable		2,618		2,245		3,325		2,852
Other current liabilities		1,986		1,703		2,629		2,255
Total current liabilities		55,787		47,846		82,461		70,724
Long-term deferred revenue		98		84		5,037		4,320
Other non-current liabilities		3,774		3,237		3,368		2,889
Total liabilities		59,659		51,167		90,866		77,933
Share capital		3,474		2,979		3,474		2,979
Capital surplus		27,128		23,266		27,110		23,251
Other components of equity		274		235		896		768
Retained earnings		84,668		72,616		132,307		113,474
Equity attributable to owners of the Parent Company		115,544		99,096		163,787		140,472
Non-controlling interest		222		190		487		418
Total equity		115,766		99,286		164,274		140,890
Total liabilities and equity		175,425		150,453		255,140		218,823

* For convenience purposes only, the KRW amounts are expressed in U.S. dollars at the rate of KRW 1,165.97 to US$ 1.00, the noon buying rate in effect on September 30, 2020 as quoted by the Federal Reserve Bank of New York.

GRAVITY Co., Ltd.

Consolidated Statements of Comprehensive Income

(In millions of KRW and thousands of US$ except for share and ADS data)

	Three months ended												Nine months ended
	30-Jun-20			30-Sep-19			30-Sep-20						30-Sep-19				30-Sep-20
	(KRW)			(KRW)			(KRW)			(US$)				(KRW)				(KRW)			(US$)
	(unaudited)			(unaudited)			(unaudited)			(unaudited)				(unaudited)				(unaudited)			(unaudited)
Revenues:
Online games-subscription revenue		24,448			10,564			29,159			25,008				23,566				63,500			54,461
Online games-royalties and license fees		4,459			2,583			2,674			2,293				9,135				10,676			9,156
Mobile games		54,249			60,086			95,531			81,933				245,189				205,762			176,473
Other revenue		5,302			4,333			4,431			3,800				11,426				13,575			11,643
Total net revenue		88,458			77,566			131,795			113,034				289,316				293,513			251,733
Cost of revenues		51,098			56,058			74,107			63,558				214,153				174,079			149,300
Gross profit		37,360			21,508			57,688			49,476				75,163				119,434			102,433
Operating expenses:
Selling, general and administrative expenses		17,643			8,984			18,042			15,474				21,382				46,692			40,046
Research and development		3,254			2,349			4,550			3,902				6,658				10,676			9,156
Others, net		150			(51	)		740			635				259				1,041			893
Total operating expenses		21,047			11,282			23,332			20,011				28,299				58,409			50,095
Operating profit		16,313			10,226			34,356			29,465				46,864				61,025			52,338
Finance income(costs):
Finance income		627			1,353			822			705				3,556				3,000			2,573
Finance costs		(605	)		(366	)		(1,503	)		(1,289	)			(781	)			(2,765	)		(2,371	)
Profit before income tax		16,335			11,213			33,675			28,881				49,639				61,260			52,540
Income tax expenses		3,293			2,357			8,390			7,196				10,192				13,687			11,739
Profit for the year		13,042			8,856			25,285			21,685				39,447				47,573			40,801
Profit attributable to:
Non-controlling interest		(53	)		(96	)		4			3				(126	)			(66	)		(57	)
Owners of Parent company		13,095			8,952			25,281			21,682				39,573				47,639			40,858
Earning per share
– Basic and diluted		1,884			1,288			3,638			3.10				5,695				6,856			5.9
Weighted average number of shares outstanding
– Basic and diluted		6,948,900			6,948,900			6,948,900			6,948,900				6,948,900				6,948,900			6,948,900
Earning per ADS⁽¹⁾
– Basic and diluted		1,884			1,288			3,638			3.10				5,695				6,856			5.9

* For convenience, the KRW amounts are expressed in U.S. dollars at the rate of KRW 1,165.97 to US$1.00, the noon buying rate in effect on September 30, 2020 as quoted by the Federal Reserve Bank of New York.
(1) Each ADS represents one common share.

November 13, 2020 6:13 am

WIRELESS TELECOM GROUP ANNOUNCES THIRD QUARTER 2020 FINANCIAL RESULTS

Highlights for the quarter ended September 30, 2020:

○	Net revenues of $10.9 million
○	Gross profit of $5.7 million, 52% gross profit margin
○	New customer orders of $10.8 million
○	New customer software and services contract for an LTE satellite project
○	Net loss of $775,000, compared to a net loss of $461,000 for the same period last year
○	Non-GAAP Adjusted EBITDA of $722,000, an increase of $625,000 or 644% from the same period last year

Parsippany, New Jersey, Nov. 13, 2020 (GLOBE NEWSWIRE) — Wireless Telecom Group, Inc. (NYSE American: WTT) (the “Company”) announced today results for the 2020 third quarter ended September 30, 2020.

Tim Whelan, CEO of Wireless Telecom Group, Inc., commented, “Despite the continued market challenges, we made progress in the third quarter executing on our strategic plan to drive long term organic growth and improved profitability. We released three new products and signed a new contract for our LTE software and services for a satellite application. Our improving gross profit margins reflect our continued success driving our Radio, Baseband and Software solutions and our Test & Measurement solutions which includes successful organic growth for our Holzworth product solutions.”

Whelan continued, “Momentum for our software solutions is accelerating, and I am excited to announce that the Company signed another new software contract in October. With this contract, we have year-to-date software and service wins of approximately $2.4 million. Our sales pipeline for our software and services solutions is robust and we expect additional new contracts to sign before the end of 2020 as well as in early 2021 which could meaningfully add scale within this market. We are thrilled that our RBS Solutions portfolio is providing successful growth milestones, including an expanding funnel, four signed contracts, and a larger backlog to be delivered over the next several quarters.”

Mr. Whelan concluded, “While the Covid-19 crisis has delayed spend on certain programs, our diversified product strategy and end-market focus has allowed us to successfully navigate through this challenging period. We remain focused on providing leading solutions for large and growing markets and we believe we are positioned for sales growth and improved profitability in 2021 and beyond.”

For the quarter ended September 30, 2020, the Company reported consolidated net revenues of $10.9 million compared to $10.8 million for the same period in 2019, which primarily reflects increases in our software licenses and Test & Measurement (T&M) products offset by lack of demand for our Radio, Baseband and Software (RBS) digital signal processing hardware products and lower sales of RF Components (RFC) products due to delays in spending by carriers on large venues. T&M revenue increased 93.5% from the prior year reflecting the inclusion of the Holzworth acquisition which contributed $2.8 million in revenue in the third quarter of 2020.

New customer orders for the third quarter were $10.8 million compared to $11.0 million in the same period in the prior year. The Company’s consolidated backlog of firm orders was $6.1 million at September 30, 2020, compared to $6.2 million at June 30, 2020. The September 30, 2020 backlog includes $875,000 of software and services compared to $385,000 at June 30, 2020.

The Company reported consolidated gross profit of $5.7 million or 52.0% of revenue, for the quarter ended September 30, 2020, compared to $4.8 million or 44.6% of revenue, for the same period in 2019. Gross margins increased in 2020 due to higher margin software sales in the RBS product group, the contribution of higher margin Holzworth products in the T&M product group and the impact of cost savings activities initiated by the Company at the beginning of the year.

For the quarter ended September 30, 2020, the Company reported consolidated operating expenses of $6.0 million, compared to $5.5 million for the same period in 2019. The increase resulted from higher investments in research and development in the area of T&M product roadmap and the addition of Holzworth operating expenses. Research and Development accounted for 30% of the operating expenses in the quarter compared to 24% during the same period in 2019.

Net loss for the quarter ended September 30, 2020 was $775,000, compared to net loss of $461,000 for the same period in 2019, primarily due to higher research and development expenses, higher foreign exchange loss, higher interest expense and higher tax expense primarily due to qualified PPP loan expenses that cannot be deducted if the loan is expected to be forgiven, offset by greater gross profit margin contribution.

Non-GAAP Adjusted EBITDA for the quarter ended September 30, 2020 was $722,000, compared to $97,000 for the same period in 2019, an increase of 644%, or $625,000. The increase in non-GAAP Adjusted EBITDA from the prior year is attributable to the increased gross margins and lower operating expenses in our core business offset by the inclusion of the operating expenses from the Holzworth acquisition. The Company’s explanation of Adjusted EBITDA and the reconciliation of Adjusted EBITDA to net income (loss) is set out below in this press release.

Conference Call

As previously announced, Wireless Telecom Group Inc. will host a conference call today at 8:30 a.m. ET in which management will discuss third quarter results and related matters. To participate in the conference call, dial 800-346-7359 or 973-528-0008. The conference identification number is 442232. The call will also be webcast over the internet at the following URL:

https://www.webcaster4.com/Webcast/Page/1690/38126

A replay will be made available on the Wireless Telecom website following the conference call.

Contact: Mike Kandell
(973) 386-9696

Use of Non-GAAP Financial Measures

The Company reports its financial results in accordance with generally accepted accounting principles (“GAAP”). Management believes, however, that certain non-GAAP financial measures used in managing the Company’s business may provide users of this financial information with additional meaningful comparisons between current results and prior reported results. Certain of the information set forth herein and certain of the information presented by the Company from time to time may constitute non-GAAP financial measures within the meaning of Regulation G adopted by the Securities and Exchange Commission. We have presented herein a reconciliation of these measures to the most directly comparable GAAP financial measure. The non-GAAP measures presented herein may not be comparable to similarly titled measures presented by other companies. The foregoing measures do not serve as a substitute and should not be construed as a substitute for GAAP performance, but provide supplemental information concerning our performance that our investors and we find useful.

The Company defines EBITDA as its net earnings before interest, taxes, depreciation and amortization. “Adjusted EBITDA” is EBITDA excluding our stock compensation expense, restructuring charges, acquisition expenses, integration expenses, unrealized and realized foreign exchange gains and losses, purchase accounting adjustments, non-recurring legal fees associated with the Harris arbitration and other non-recurring costs. A reconciliation of net income to non-GAAP Adjusted EBITDA is included as an attachment to this press release.

The Company defines Adjusted EBITDA margin as Adjusted EBITA divided by revenue. The Company does not provide a forward-looking reconciliation of expected Adjusted EBITDA Margin because the amount and significance of special items required to develop meaningful comparable GAAP financial measures cannot be estimated at this time without unreasonable efforts. These special items could be meaningful.

GAAP operating expenses (“GAAP opex”) includes research and development expenses, sales and marketing expenses and general and administrative expenses. The Company defines non-GAAP Operating Expenses (“Non-GAAP Opex”) as GAAP opex excluding stock compensation expense, restructuring charges, acquisition expenses, integration expenses, depreciation and amortization expense, non-recurring legal fees associated with the Harris arbitration and other non-recurring costs and expenses.

The Company views Adjusted EBITDA, Adjusted EBITDA margin and Non-GAAP Opex as important indicators of performance, consistent with the manner in which management measures and forecasts the Company’s performance. We believe Adjusted EBITDA is an important performance metric because it facilitates the analysis of our results, exclusive of certain non-cash and non-recurring items, including items which do not directly correlate to our business operations.

The Company believes that Adjusted EBITDA and Non GAAP Opex metrics provide qualitative insight into our current performance; we use these measures to evaluate our results, the performance of our management team and our management’s entitlement to incentive compensation; and we believe that making this information available to investors enables them to view our performance the way that we view our performance and thereby gain a meaningful understanding of our core operating results, in general, and from period to period.

Forward-Looking Statements

This press release contains “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. In some cases, such forward-looking statements may be identified by terms such as believe, expect, seek, may, will, intend, project, anticipate, plan, estimate, guidance or similar words. Forward-looking statements include, among others, statements related to the ongoing effects the COVID-19 pandemic is expected to have on our business; our expectation of additional new contracts to sign in the future as well as the meaningfulness and added scale of any such contracts; our position for sales growth and improved profitability in the future and financial results and statements regarding the overall improving margins and opportunity for continued growth ahead, goals of organic double digit revenue growth, 50+% gross margins and Adjusted EBITDA margins of 15% by 2024. Investors are cautioned that such forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties that could materially affect actual results, including, among others, the impact of the coronavirus outbreak on customer orders, supply chain and the Company’s operations; the ability of the Company to obtain forgiveness of the PPP loan pursuant to the CARES Act and provisions of the PPP; the demand for private 4G LTE and 5G private networks; the loss of any significant customers of the Company; the ability of management to successfully implement the Company’s business plan and strategy; management’s ability to integrate the Holzworth business successfully; the impact of competitive products and pricing; as well as other risks and uncertainties set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 as supplemented and revised by the risks and uncertainties set forth in the Company’s subsequent reports filed with the SEC. These forward-looking statements speak only as of the date of this release and the Company does not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise, as except as required by law.

About Wireless Telecom Group, Inc.

Wireless Telecom Group, Inc., comprised of Boonton, CommAgility, Holzworth, Microlab and Noisecom, is a global designer and manufacturer of advanced RF and microwave components, modules, systems, and instruments. Serving the wireless, telecommunication, satellite, military, aerospace, semiconductor and medical industries, Wireless Telecom Group products enable innovation across a wide range of traditional and emerging wireless technologies. With a unique set of high-performance products including peak power meters, signal generators, phase noise analyzers, signal processing modules, LTE PHY/stack software, power splitters and combiners, GPS repeaters, public safety components, noise sources, and programmable noise generators, Wireless Telecom Group enables the development, testing, and deployment of wireless technologies around the globe. Wireless Telecom Group is headquartered in Parsippany, New Jersey, in the New York City metropolitan area, and maintains a global network of Sales and Service offices for excellent product service and support. Wireless Telecom Group’s website address is http://www.wirelesstelecomgroup.com.

Contact:

Michael Kandell: +1 (973) 386-9696
Wireless Telecom Group Inc.
25 Eastmans Road
Parsippany, NJ 07054
Tel: (973) 386-9696
Fax: (973) 386-9191
www.wtcom.com

Wireless Telecom Group, Inc.

CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME/(LOSS)

(In thousands, except per share amounts, Unaudited)

	For the Three Months Ended						For the Nine Months Ended
	September 30						September 30
	2020			2019			2020			2019
Net revenues	$	10,868		$	10,812		$	31,404		$	37,353

Cost of revenues		5,214			5,987			15,655			20,668

Gross profit		5,654			4,825			15,749			16,685

Operating expenses
Research and development		1,826			1,343			5,080			4,556
Sales and marketing		1,732			1,753			5,111			5,718
General and administrative		2,444			2,407			7,322			7,341
Total operating expenses		6,002			5,503			17,513			17,615

Operating loss		(348	)		(678	)		(1,764	)		(930	)

Other income/(expense)		(43	)		108			252			273
Interest (expense)		(256	)		(60	)		(727	)		(248	)

Loss before taxes		(647	)		(630	)		(2,239	)		(905	)

Tax provision/(benefit)		128			(169	)		352			(256	)

Net Loss	$	(775	)	$	(461	)	$	(2,591	)	$	(649	)

Other comprehensive income/(loss):
Foreign currency translation adjustments		565			(491	)		(406	)		(566	)
Comprehensive loss	$	(210	)	$	(952	)	$	(2,997	)	$	(1,215	)

Loss per share:
Basic	$	(0.04	)	$	(0.02	)	$	(0.12	)	$	(0.03	)
Diluted	$	(0.04	)	$	(0.02	)	$	(0.12	)	$	(0.03	)

Weighted average shares outstanding:
Basic		21,703			20,866			21,643			20,854
Diluted		21,703			20,866			21,643			20,854

In periods with a net loss, the basic loss per share equals the diluted loss per share as all common stock equivalents are excluded from the per share calculation because they are anti-dilutive.

CONSOLIDATED BALANCE SHEET

(In thousands, except number of shares and par value)

	(Unaudited)
	September 30 2020			December 31 2019
CURRENT ASSETS
Cash & cash equivalents	$	2,203		$	4,245
Accounts receivable – net of reserves of $42 and $69, respectively		8,040			6,152
Inventories – net of reserves of $1,082 and $969, respectively		9,074			7,325
Prepaid expenses and other current assets		2,074			1,871
TOTAL CURRENT ASSETS		21,391			19,593

PROPERTY PLANT AND EQUIPMENT – NET		1,898			2,147

OTHER ASSETS
Goodwill		15,881			10,069
Acquired intangible assets, net		5,479			2,219
Deferred income taxes		4,956			6,013
Right of use assets		1,814			1,436
Other		1,617			874
TOTAL OTHER ASSETS		29,747			20,611

TOTAL ASSETS	$	53,036		$	42,351

CURRENT LIABILITIES
Short term debt	$	84		$	2,696
Accounts payable		1,894			2,227
Short term leases		527			440
Accrued expenses and other current liabilities		8,497			2,657
Deferred revenue		170			42
TOTAL CURRENT LIABILITIES		11,172			8,062

LONG TERM LIABILITIES
Long term debt		9,290			–
Long term leases		1,338			1,018
Other long term liabilities		89			77
Deferred tax liability		492			503
TOTAL LONG TERM LIABILITIES		11,209			1,598

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS’ EQUITY
Preferred stock, $.01 par value, 2,000,000 shares authorized, none issued		–			–
Common stock, $.01 par value, 75,000,000 shares authorized 34,905,571 and 34,488,252 shares issued, 21,695,010 and 21,300,252 shares outstanding		349			345
Additional paid in capital		50,049			49,062
Retained earnings		4,552			7,142
Treasury stock at cost, 13,210,561 and 13,188,000 shares		(24,540	)		(24,509	)
Accumulated other comprehensive income		245			651
TOTAL SHAREHOLDERS’ EQUITY		30,655			32,691

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	53,036		$	42,351

CONSOLIDATED STATEMENT OF CASH FLOWS

(In thousands, unaudited)

	For the Nine Months
	Ended September 30
	2020			2019
CASH FLOWS USED BY OPERATING ACTIVITIES
Net Loss	$	(2,591	)	$	(649	)
Adjustments to reconcile net loss to net cash used by operating activities:
Depreciation and amortization		1,631			1,671
Amortization of debt issuance fees		215			47
Share-based compensation expense		360			560
Deferred rent		(22	)		(18	)
Deferred income taxes		1,057			(309	)
Provision for doubtful accounts		(28	)		20
Inventory reserves		119			139
Changes in assets and liabilities, net of acquisition:
Accounts receivable		(1,343	)		520
Inventories		(461	)		(1,627	)
Prepaid expenses and other assets		(226	)		993
Accounts payable		(451	)		(567	)
Payment of contingent consideration		–			(772	)
Accrued expenses and other liabilities		888			(1,635	)
Net cash used by operating activities		(852	)		(1,627	)

CASH FLOWS USED BY INVESTING ACTIVITIES
Capital expenditures		(228	)		(339	)
Acquisition of business, net of cash acquired		(7,189	)		(426	)
Net cash used by investing activities		(7,417	)		(765	)

CASH FLOWS PROVIDED BY FINANCING ACTIVITIES
Revolver borrowings		27,432			27,408
Revolver repayments		(29,786	)		(26,333	)
Term loan borrowings		8,400			–
Term loan repayments		(405	)		(114	)
Debt issuance fees		(1,305	)		–
Paycheck protection program loan		2,045			–
Payment of contingent consideration		–			(782	)
Proceeds from exercise of stock options		15			–
Shares withheld for employee taxes		(31	)		–
Net cash provided by financing activities		6,365			179

Effect of Exchange Rate Changes on Cash and Cash Equivalents		(138	)		(67	)
NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS		(2,042	)		(2,280	)

Cash and Cash Equivalents, at Beginning of Period		4,245			5,015

CASH AND CASH EQUIVALENTS, AT END OF PERIOD	$	2,203		$	2,735

SUPPLEMENTAL INFORMATION:
Cash paid during the period for interest	$	527		$	143
Cash paid during the period for income taxes	$	53		$	69

NET REVENUE AND GROSS PROFIT BY PRODUCT GROUP

(In thousands, Unaudited)

	Three months ended September 30,
	Revenue								% of Revenue						Change
	2020				2019				2020			2019			Amount			Pct.
RF components	$		4,418		$		5,185			40.7	%		48.0	%	$	(767	)		-14.8	%
Test and measurement			5,797				2,996			53.3	%		27.7	%		2,801			93.5	%
Radio, baseband, software			653				2,631			6.0	%		24.3	%		(1,978	)		-75.2	%
Total net revenues	$		10,868		$		10,812			100.0	%		100.0	%	$	56			0.5	%

	Three months ended September 30,
	Gross Profit								Gross Profit %						Change
	2020				2019				2020			2019			Amount			Pct.
RF components	$		1,927		$		2,104			43.6	%		40.6	%	$	(177	)		-8.4	%
Test and measurement			3,182				1,497			54.9	%		50.0	%		1,685			112.6	%
Radio, baseband, software			545				1,224			83.5	%		46.5	%		(679	)		-55.5	%
Total gross profit	$		5,654		$		4,825			52.0	%		44.6	%	$	829			17.2	%

	Nine months ended September 30,
	Revenue								% of Revenue						Change
	2020				2019				2020			2019			Amount			Pct.
RF components	$	14,555			$		16,518			46.4	%		44.2	%	$	(1,963	)		-11.9	%
Test and measurement		14,013					9,219			44.6	%		24.7	%		4,794			52.0	%
Radio, baseband, software		2,836					11,616			9.0	%		31.1	%		(8,780	)		-75.6	%
Total net revenues	$	31,404			$		37,353			100.0	%		100.0	%	$	(5,949	)		-15.9	%

	Nine months ended September 30,
	Gross Profit							Gross Profit %							Change
	2020			2019				2020				2019			Amount			Pct.
RF components	$	6,576		$		6,893				45.2	%		41.7	%	$	(317	)		-4.6	%
Test and measurement		7,451				4,843				53.2	%		52.5	%		2,608			53.9	%
Radio, baseband, software		1,722				4,949				60.7	%		42.6	%		(3,227	)		-65.2	%
Total gross profit	$	15,749		$		16,685				50.1	%		44.7	%	$	(936	)		-5.6	%

RECONCILIATION OF NET INCOME TO NON-GAAP EBITDA AND NON-GAAP ADJUSTED EBITDA

(In thousands, Unaudited)

	Three Months Ended						Nine Months Ended
	September 30						September 30
	2020			2019			2020			2019
GAAP net income/(loss), as reported	$	(775	)	$	(461	)	$	(2,591	)	$	(649	)
Tax provision/(benefit)		128			(169	)		352			(256	)
Depreciation and amortization expense		579			474			1,628			1,671
Interest expense		256			60			727			248
Non-GAAP EBITDA		188			(96	)		116			1,014
Stock compensation		151			160			360			560
Merger and acquisition/integration		15			–			243			–
Restructuring costs		46			123			119			123
Inventory impairment recovery		(14	)		(13	)		(26	)		(18	)
US GAAP purchase accounting		258			–			548			–
FX (gain)/loss		95			(108	)		(140	)		(257	)
Non recurring arbitration legal costs		(17	)		31			(14	)		156
Non-GAAP adjusted EBITDA	$	722		$	97		$	1,206		$	1,578

RECONCILIATION OF GAAP OPEX TO NON-GAAP OPEX

(In thousands, Unaudited)

	Three Months Ended						Nine Months Ended
	September 30						September 30
	2020			2019			2020			2019
GAAP Opex	$	6,002		$	5,503		$	17,513		$	17,615
Stock compensation		(151	)		(160	)		(360	)		(559	)
Merger and acquisition/integration		(15	)		–			(243	)		–
Restructuring costs		(46	)		(123	)		(119	)		(123	)
US GAAP purchase accounting		–			–			(100	)		–
Depreciation & amortization (ex. COGS)		(478	)		(421	)		(1,356	)		(1,479	)
Non recurring arbitration legal costs		17			(31	)		14			(156	)
Non GAAP Opex	$	5,329		$	4,768		$	15,349		$	15,298

November 13, 2020 6:11 am

Holberton School’s Montevideo Campus Inaugurated by Uruguay’s Minister of Labor and Social Welfare

SAN FRANCISCO, Nov. 13, 2020 (GLOBE NEWSWIRE) — Holberton School, the college alternative educating the next generation of software engineers, alongside Fundación Zonamerica, hosted a ceremony to celebrate the inauguration of its Montevideo, Uruguay campus in Jacksonville. This initiative aims to reduce the digital talent gap existing in the country to satisfy the needs of the local technological industry by training students to become software engineers. The first cohort began in September this year with a group of 29 students.

The first lady of Uruguay, Lorena Ponce de León; Minister of Labor and Social Welfare, Pablo Mieres; Fundación Zonamerica President and Vice-President, Alberto Fossati and Orlando Dovat; Executive director of Holberton School in Montevideo, Inés Jakubovski; Elected Mayor of Montevideo, Carolina Cosse; the Subsecretary of Education Ana Ribeiro and the President of the Uruguayan Chamber of information technology (CUTI), Leonardo Loureiro as well as other governmental authorities, foundation leadership, business chambers, companies that support the program as Hiring Partners, and students attended the event. The opening ceremony followed all sanitary precautions and included a tour of Holberton School’s Montevideo campus.

Holberton President and Co-founder Sylvain Kalache attended the event through a video call from Silicon Valley, sharing his excitement to be part of the Uruguay tech ecosystem. Additionally, authorities from Inefop, the US embassy in Uruguay, Instituto Uruguay XX1, Municipality Mayor, CAF representatives, and role models from educational institutions and enterprises in the IT sector were also present.

“Concern to fill the prevailing digital gap and the lack of programmer training in Uruguay inspired the project. When we were considering establishing a Holberton School here, and after the successful experience in Cali, we got in touch with CUTI members and concluded that doing the same here was a huge opportunity,” said Orlando Dovat, Vice-President of Fundación Zonamerica. “We know it is just a grain of sand that we can provide to the area; nonetheless, this contribution is all about quality, not quantity. Beyond that, it is also about learning from this education methodology that we could incorporate in Uruguay while looking forward to the future through a high level of training.”

Uruguay Minister of Labor and Social Welfare, Pablo Mieres, emphasized the role played by Zonamerica and the foundation about training Uruguayans.

“The initiative of creating a Holberton School in Uruguay is a reaffirmation of a fundamental value of the country, which is having people always create innovative ideas. The experience of this establishment in Uruguay is a symbol that shows the way forward in the right direction to follow between training and employment for a wealthy, state-of-the-art country that looks toward the future.”

President of the Uruguayan Chamber of information technology (CUTI), Leonardo Loureiro, highlighted the importance of this type of intensive, campus-based training.

“We are currently working on redesigning the UTU curriculum, the technical part of the high school program, and computer literacy programs at all levels of education. It is essential to have a school that focuses solely on this topic. As a chamber and business sector, we are happy that this kind of initiative is being carried out.”

Montevideo´s elected Mayor, Carolina Cosse underscored the demand for jobs in a flourishing industry and the material conditions for it to happen in Uruguay.

“We don’t have a digital gap in terms of infrastructure because we have optical fiber, an undersea cable, a Data Center, El Ceibal, which are the physical foundations to keep building on them. For this reason, I welcome and congratulate this project, and also because I think this type of initiative, both from the public and private sectors, must continue flourishing.”

“I hope creativity and imagination will always be with you, like those characteristics we inherit from the old French educational system of Progressive Education, which is the ability to be better generalists than specialists. These young people will have to solve not only general problems, but they must also learn to solve problems they have not imagined yet. I wish them a prosperous life full of learning,” said Ana Ribeiro, Uruguay Subsecretary of the Ministry of Education

Editorial Contact

Sylvain Kalache
[email protected]