Schedule 1: Reconciliation of Adjusted EBITDA and constant currency revenues

 
Reconciliation of Non-GAAP Financial Measures to GAAP 
 Measures 
--------------------------------------------------------  ---------------- 
 
Non-GAAP constant currency revenue 
reconciliation 
                                         Three Months ended September 30, 
                                        ---------------------------------- 
($ in thousands)                              2024              2023 
-------------------------------------   ----------------  ---------------- 
 
Revenues, as reported (GAAP)                      35,400            37,496 
Foreign currency exchange impact (1)               (688) 
                                        ----------------  ---------------- 
Revenues, at constant currency 
 (Non-GAAP)                                       34,712            37,496 
 
Reconciliation of Adjusted EBITDA 
from Continuing Operations 
-------------------------------------   ----------------  ---------------- 
 
                                         Three Months ended September 30, 
                                        ---------------------------------- 
($ in thousands)                                    2024              2023 
-------------------------------------   ----------------  ---------------- 
 
Net loss from Continuing Operations 
 (GAAP)                                          (1,226)           (1,219) 
Income tax expense                                 1,664             1,046 
Interest expense including related 
 party interest expense, net                       1,843             1,251 
Depreciation and amortization                        804               745 
                                        ----------------  ---------------- 
EBITDA from Continuing Operations 
 (Non-GAAP)                                        3,085             1,823 
Restructuring and related expenses (2)               316               309 
Employment litigation matter (3)                      57                64 
Related party management fee and 
 royalties                                             -               334 
Foreign exchange losses, net                         668             (530) 
Non-cash equity compensation (4)                     725                 - 
Changes in fair value of warrant 
 liability                                           (5)                 - 
Transaction Fees (5)                                   -               244 
                                        ----------------  ---------------- 
Adjusted EBITDA from Continuing 
 Operations (Non-GAAP) (6)                         4,846             2,244 
Reconciliation of Adjusted EBITDA 
from Discontinuing Operations 
-------------------------------------   ----------------  ---------------- 
 
                                         Three Months ended September 30, 
                                        ---------------------------------- 
($ in thousands)                                    2024              2023 
-------------------------------------   ----------------  ---------------- 
 
Net loss from Discontinuing 
 Operations, Net of Income Taxes 
 (GAAP)                                          (1,543)           (1,668) 
Income tax expense                                    72                 - 
Interest expense, net                                  3                19 
Depreciation and amortization                        135               350 
                                        ----------------  ---------------- 
EBITDA from Discontinuing Operations 
 (Non-GAAP)                                      (1,333)           (1,299) 
Restructuring and related expenses 
(7)                                                    -                 - 
Related party service fees and 
royalties                                              -                 - 
Impairment of goodwill                                87                 - 
Foreign exchange losses, net                           2                 1 
                                        ----------------  ---------------- 
Adjusted EBITDA from Discontinuing 
 Operations (Non-GAAP) (6)                       (1,244)           (1,298) 
 
 

(1) Constant currency excludes the impact of foreign currency fluctuations and is computed by applying the average exchange rates for the quarter ended September 30, 2023, to the revenues during the corresponding period in 2024.

(2) Adjustment represents costs associated with restructuring, including employee severance and vendor and lease termination costs.

(3) Represents the litigation settlement and associated expenses incurred in connection with the Company subsidiary litigation.

(4) Represents the non-cash charges related to restricted stock units and options.

(5) Represents transaction costs incurred as part of the Business Combination.

(6) Supplemental financial measures that are not required by, or presented in accordance with, accounting principles generally accepted in the United States ("GAAP"). These non-GAAP financial measures should not be considered as alternatives to operating or net income or cash flows from operating activities, in each case determined in accordance with GAAP. These non-GAAP financial measures are among the indicators used by management to measure the performance of the Company's operations, and also among the criteria upon which performance-based compensation may be based. Adjusted EBITDA also is used by our lenders for debt covenant compliance purposes.

Similar non-GAAP financial measures may be calculated differently by other companies, including other companies in our industry, limiting their usefulness as comparative measures. Because of these limitations, you should consider the non-GAAP financial measures alongside other performance measures and liquidity measures, including operating income, various cash flow metrics, net income and our other GAAP results.

(7) Adjustment represents costs associated with restructuring related to employee severance.

Source: XBP Europe Holdings, Inc.

(END) Dow Jones Newswires

November 12, 2024 16:52 ET (21:52 GMT)