i3 Verticals Reports Second Quarter 2019 Financial Results
Highlights for the fiscal second quarter and six months ended
- Second quarter revenue was
$85.4 million , an increase of 10% over the prior year's second quarter; Revenue was$170.3 million for the six months endedMarch 31, 2019 , an increase of 10% over the prior year's first six months. - Second quarter adjusted net revenue1, which excludes acquisition revenue adjustments and interchange and network fees, was
$31.4 million , an increase of 16% over the prior year's second quarter; Adjusted net revenue1 was$61.0 million for the six months endedMarch 31, 2019 , an increase of 17% over the prior year's first six months.
- Second quarter net loss was
$1.2 million ; Net income was$1.1 million for the six months endedMarch 31, 2019 . - Second quarter adjusted EBITDA1 was
$8.7 million , an increase of 13% over the prior year's second quarter; Adjusted EBITDA1 was$17.3 million for the six months endedMarch 31, 2019 , an increase of 19% over the prior year's first six months. - Second quarter adjusted EBITDA1 as a percentage of adjusted net revenue1 was 28%, compared to 28% in the prior year's second quarter; Adjusted EBITDA1 as a percentage of adjusted net revenue1 was 28% for the six months ended
March 31, 2019 , compared to 28% in the prior year's first six months.
- Second quarter diluted net loss per share available to Class A common stock was
$0.12 ; Diluted net loss per share available to Class A common stock was$0.10 for the six months ended March 31, 2019. - For the three and six months ended
March 31, 2019 , pro forma adjusted diluted earnings per share1, which gives pro forma effect to the Company's going forward effective tax rate, was$0.20 and$0.40 , respectively.
- Integrated payments2 were 49% and 47% of payment volume for the three and six months ended
March 31, 2019 , respectively. - At
March 31, 2019 , the ratio of consolidated debt-to-EBITDA, as defined in the Company's Senior Secured Credit Facility, was 2.06x. Giving effect to the two acquisitions sinceMarch 31, 2019 discussed below, the Company's consolidated debt-to-EBITDA ratio is currently approximately 2.75x. - Since the first quarter earnings release issued on
February 13, 2019 , and as previously announced in our press releases datedMarch 4, 2019 andApril 8, 2019 , the Company completed three acquisitions focused on its Public Sector vertical. Two of the acquisitions were completed during the second quarter, with the third acquisition, NET Data, completed subsequent toMarch 31, 2019 . - Effective
May 1, 2019 , the Company completed an acquisition in the Education vertical, which is the Company's first acquisition in this vertical since its initial public offering. This acquisition expands the Company's geographic reach within the Education vertical, primarily in large states such asFlorida andTexas , and also enhances the software offered to this market. The up-front cash consideration for this acquisition was$10.0 million . - On
May 9, 2019 , the Company closed an amended$300 million Senior Secured Credit Facility. The new credit facility is an all-revolver structure and was led byBank of America, N.A. , withFifth Third Bank serving as joint bookrunner. The maximum senior debt-to-EBITDA ratio permitted under the credit facility is 3.75x, with a step-down to 3.50x. Reductions in interest rate spreads were also achieved in the amended facility.
- Represents a non-GAAP financial measure. For additional information (including reconciliation information), see the attached schedules to this release.
- Integrated payments represents payment transactions that are generated in situations where payment technology is embedded within the Company's own proprietary software, a client’s software or critical business process.
“We are also excited to complete an acquisition within our Education vertical. The Education vertical is a priority for
“We also are pleased to announce the completion of our new credit facility. Our acquisition pipeline remains strong, and our expanded borrowing capacity will help to enable us to continue to execute strategic acquisitions in our target vertical markets. We appreciate the support we received from our bank group.”
In conclusion, Daily added, “While acquisitions have driven much of our communication to the market, we are pleased with our core performance. We continue to focus on building our technology to fuel further organic growth. The progress of our existing team coupled with our recent acquisitions gives us great confidence in our future growth opportunities.”
2019 Outlook
The Company announced that it is maintaining its guidance issued on
(in thousands, except per share amounts) | Outlook Range | ||||
Fiscal year ending September 30, 2019 | |||||
Adjusted net revenue(1) (non-GAAP) | $ | 127,000 | - | $ | 133,000 |
Adjusted EBITDA (non-GAAP) | $ | 36,500 | - | $ | 39,500 |
Adjusted diluted earnings per share(2) (non-GAAP) | $ | 0.85 | - | $ | 0.90 |
_______________________
- Under GAAP, companies must adjust, as necessary, beginning balances of acquired deferred revenue to fair value as part of acquisition accounting as defined by GAAP. For the 2019 outlook, the Company has removed the effect of these adjustments to acquisition date fair value from acquisitions that have closed as of the earnings release date.
- Assumes an effective pro forma tax rate of 25.0% (non-GAAP).
With respect to the “2019 Outlook,” reconciliation of adjusted net revenue, adjusted EBITDA and adjusted diluted earnings per share guidance to the closest corresponding GAAP measure on a forward-looking basis is not available without unreasonable efforts. This inability results from the inherent difficulty in forecasting generally and quantifying certain projected amounts that are necessary for such reconciliations. In particular, sufficient information is not available to calculate certain adjustments required for such reconciliations, including changes in the fair value of contingent consideration, income tax expense of i3 Verticals, Inc. and equity-based compensation expense. The Company expects these adjustments may have a potentially significant impact on future GAAP financial results.
Conference Call
The Company will host a conference call on Tuesday, May 14, 2019, at
To listen to the call live via webcast, participants should visit the “Investors” section of the Company’s website, www.i3verticals.com, and go to the “Events & Presentations” page approximately 10 minutes prior to the start of the call. The online replay will be available on this page of the Company’s website beginning shortly after the conclusion of the call and will remain available for 30 days.
Non-GAAP Measures
This press release contains information prepared in conformity with GAAP as well as non-GAAP information. It is management’s intent to provide non-GAAP financial information to enhance understanding of the Company's consolidated financial information as prepared in accordance with GAAP. This non-GAAP information should be considered by the reader in addition to, but not instead of, the financial statements prepared in accordance with GAAP. Each non-GAAP financial measure and the most directly comparable GAAP financial measure are presented so as not to imply that more emphasis should be placed on the non-GAAP measure. The non-GAAP financial information presented may be determined or calculated differently by other companies.
Additional information about non-GAAP financial measures, including, but not limited to, adjusted net revenue, pro forma adjusted net income, adjusted EBITDA and pro forma adjusted diluted EPS, and a reconciliation of those measures to the most directly comparable GAAP measures is included on pages 10 through 12 in the financial schedules of this release.
About
Helping drive the convergence of software and payments,
Forward-Looking Statements
This release contains forward-looking statements that are subject to risks and uncertainties. All statements other than statements of historical fact or relating to present facts or current conditions included in this release are forward-looking statements, including any statements regarding guidance and statements of a general economic or industry specific nature. Forward-looking statements give the Company's current expectations and projections relating to its financial condition, results of operations, guidance, plans, objectives, future performance and business. You generally can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “anticipate,” “estimate,” “expect,” “project,” “plan,” “intend,” “believe,” “may,” “will,” “should,” “could have,” “exceed,” “significantly,” “likely” and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events.
The forward-looking statements contained in this release (such as our acquisition pipeline and our 2019 outlook) are based on assumptions that we have made in light of the Company's industry experience and its perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. As you review and consider information presented herein, you should understand that these statements are not guarantees of future performance or results. They depend upon future events and are subject to risks, uncertainties (many of which are beyond the Company's control) and assumptions. Although we believe that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect the Company's actual future performance or results and cause them to differ materially from those anticipated in the forward-looking statements. Certain of these factors and other risks are discussed in the Company's filings with the
Any forward-looking statement made by us in this release speaks only as of the date of this release. Factors or events that could cause the Company's actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.
Contacts: | |
Clay Whitson | Scott Meriwether |
Chief Financial Officer | Senior Vice President - Finance |
(615) 988-9890 | (615) 942-6175 |
cwhitson@i3verticals.com | smeriwether@i3verticals.com |
(Unaudited)
($ in thousands, except share and per share amounts)
Three months ended March 31, | Six months ended March 31, | ||||||||||||||||||||
2019 | 2018 | % Change | 2019 | 2018 | % Change | ||||||||||||||||
Revenue | $ | 85,394 | $ | 77,699 | 10 | % | $ | 170,262 | $ | 154,920 | 10 | % | |||||||||
Operating expenses | |||||||||||||||||||||
Interchange and network fees | 54,685 | 50,634 | 8 | % | 110,514 | 102,872 | 7 | % | |||||||||||||
Other costs of services | 10,193 | 9,505 | 7 | % | 19,983 | 19,058 | 5 | % | |||||||||||||
Selling general and administrative | 14,319 | 10,197 | 40 | % | 26,835 | 19,041 | 41 | % | |||||||||||||
Depreciation and amortization | 3,898 | 3,020 | 29 | % | 7,450 | 5,876 | 27 | % | |||||||||||||
Change in fair value of contingent consideration | 2,502 | 1,747 | 43 | % | 2,153 | 2,129 | 1 | % | |||||||||||||
Total operating expenses | 85,597 | 75,103 | 14 | % | 166,935 | 148,976 | 12 | % | |||||||||||||
Income from operations | (203 | ) | 2,596 | (108 | )% | 3,327 | 5,944 | (44 | )% | ||||||||||||
Other expenses | |||||||||||||||||||||
Interest expense, net | 1,155 | 2,618 | (56 | )% | 2,069 | 5,006 | (59 | )% | |||||||||||||
Change in fair value of warrant liability | — | 6,564 | n/m | — | 8,245 | n/m | |||||||||||||||
Total other expenses | 1,155 | 9,182 | (87 | )% | 2,069 | 13,251 | (84 | )% | |||||||||||||
(Loss) income before income taxes | (1,358 | ) | (6,586 | ) | n/m | 1,258 | (7,307 | ) | n/m | ||||||||||||
(Benefit from) provision for income taxes | (136 | ) | 250 | (154 | )% | 129 | (139 | ) | (193 | )% | |||||||||||
Net (loss) income | (1,222 | ) | (6,836 | ) | n/m | 1,129 | (7,168 | ) | n/m | ||||||||||||
Net income attributable to non‑controlling interest | (120 | ) | — | n/m | 2,053 | — | n/m | ||||||||||||||
Net (loss) income attributable to i3 Verticals, Inc. | $ | (1,102 | ) | $ | (6,836 | ) | (84 | )% | $ | (924 | ) | $ | (7,168 | ) | (87 | )% | |||||
Net loss per share available to Class A common stock(1): | |||||||||||||||||||||
Basic | $ | (0.12 | ) | $ | (0.10 | ) | |||||||||||||||
Diluted | $ | (0.12 | ) | $ | (0.10 | ) | |||||||||||||||
Weighted average shares of Class A common stock outstanding(1): | |||||||||||||||||||||
Basic | 8,887,050 | 8,849,431 | |||||||||||||||||||
Diluted | 8,887,050 | 8,849,431 |
n/m = not meaningful
________
- Basic and diluted net loss per Class A common stock are presented only for the period after the Company’s Reorganization Transactions.
(Unaudited)
($ in thousands, except per share amounts)
Three months ended March 31, | Six months ended March 31, | ||||||||||||||||
2019 | 2018 | % Change | 2019 | 2018 | % Change | ||||||||||||
Adjusted net revenue (non‑GAAP) | $ | 31,448 | $ | 27,065 | 16 | % | $ | 61,018 | $ | 52,048 | 17 | % | |||||
Adjusted EBITDA (non-GAAP) | 8,747 | 7,713 | 13 | % | 17,325 | 14,561 | 19 | % | |||||||||
Pro forma adjusted diluted earnings per share (non-GAAP) | $ | 0.20 | $ | 0.40 |
(Unaudited)
($ in thousands)
Three months ended March 31, | Six months ended March 31, | ||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||
Payment volume(1) | $ | 2,942,808 | $ | 2,758,292 | $ | 5,886,657 | $ | 5,586,221 |
__________
- Payment volume is the net dollar value of both 1) Visa,
Mastercard and other payment network transactions processed by the Company's clients and settled to clients by us and 2) ACH transactions processed by the Company's clients and settled to clients by the Company.
(Unaudited)
($ in thousands)
As of and for the Three Months Ended March 31, 2019 | |||||||||||||||
Merchant Services |
Proprietary Software and Payments |
Other |
Total |
||||||||||||
Revenue | $ | 76,875 | $ | 8,519 | $ | — | $ | 85,394 | |||||||
Operating expenses | |||||||||||||||
Interchange and network fees | 53,121 | 1,564 | — | 54,685 | |||||||||||
Other costs of services | 9,725 | 468 | — | 10,193 | |||||||||||
Selling general and administrative | 6,226 | 3,675 | 4,418 | 14,319 | |||||||||||
Depreciation and amortization | 2,917 | 842 | 139 | 3,898 | |||||||||||
Change in fair value of contingent consideration | (390 | ) | 2,892 | — | 2,502 | ||||||||||
Income (loss) from operations | $ | 5,276 | $ | (922 | ) | $ | (4,557 | ) | $ | (203 | ) | ||||
Payment volume | $ | 2,794,120 | $ | 148,688 | $ | — | $ | 2,942,808 |
As of and for the Six Months Ended March 31, 2019 | |||||||||||||
Merchant Services | Proprietary Software and Payments | Other | Total | ||||||||||
Revenue | $ | 154,577 | $ | 15,685 | $ | — | $ | 170,262 | |||||
Operating expenses | |||||||||||||
Interchange and network fees | 107,485 | 3,029 | — | 110,514 | |||||||||
Other costs of services | 19,121 | 862 | — | 19,983 | |||||||||
Selling general and administrative | 12,317 | 6,662 | 7,856 | 26,835 | |||||||||
Depreciation and amortization | 5,699 | 1,503 | 248 | 7,450 | |||||||||
Change in fair value of contingent consideration | (709 | ) | 2,862 | — | 2,153 | ||||||||
Income (loss) from operations | $ | 10,664 | $ | 767 | $ | (8,104 | ) | $ | 3,327 | ||||
Payment volume | $ | 5,598,259 | $ | 288,398 | $ | — | $ | 5,886,657 |
As of and for the Three Months Ended March 31, 2018 | ||||||||||||
Merchant Services | Proprietary Software and Payments | Other | Total | |||||||||
Revenue | $ | 72,226 | $ | 5,473 | $ | — | $ | 77,699 | ||||
Operating expenses | ||||||||||||
Interchange and network fees | 49,292 | 1,341 | 1 | 50,634 | ||||||||
Other costs (benefits) of services | 9,113 | 393 | (1 | ) | 9,505 | |||||||
Selling general and administrative | 6,114 | 1,943 | 2,140 | 10,197 | ||||||||
Depreciation and amortization | 2,406 | 581 | 33 | 3,020 | ||||||||
Change in fair value of contingent consideration | 1,573 | 174 | — | 1,747 | ||||||||
Income (loss) from operations | $ | 3,728 | $ | 1,041 | $ | (2,173 | ) | $ | 2,596 | |||
Payment volume | $ | 2,627,705 | $ | 130,587 | $ | — | $ | 2,758,292 |
As of and for the Six Months Ended March 31, 2018 | ||||||||||||
Merchant Services | Proprietary Software and Payments | Other | Total | |||||||||
Revenue | $ | 144,906 | $ | 10,017 | $ | (3 | ) | $ | 154,920 | |||
Operating expenses | ||||||||||||
Interchange and network fees | 100,339 | 2,533 | — | 102,872 | ||||||||
Other costs (benefits) of services | 18,256 | 803 | (1 | ) | 19,058 | |||||||
Selling general and administrative | 11,002 | 3,637 | 4,402 | 19,041 | ||||||||
Depreciation and amortization | 4,715 | 1,097 | 64 | 5,876 | ||||||||
Change in fair value of contingent consideration | 1,448 | 681 | — | 2,129 | ||||||||
Income (loss) from operations | $ | 9,146 | $ | 1,266 | $ | (4,468 | ) | $ | 5,944 | |||
Payment volume | $ | 5,333,485 | $ | 252,736 | $ | — | $ | 5,586,221 |
($ in thousands, except share and per share amounts)
March 31, | September 30, | |||||
2019 | 2018 | |||||
(unaudited) | ||||||
Assets | ||||||
Current assets | ||||||
Cash and cash equivalents | $ | 1,393 | $ | 572 | ||
Accounts receivable, net | 11,703 | 12,500 | ||||
Settlement assets | 439 | 863 | ||||
Prepaid expenses and other current assets | 3,246 | 2,630 | ||||
Total current assets | 16,781 | 16,565 | ||||
Property and equipment, net | 3,055 | 2,958 | ||||
Restricted cash | 666 | 665 | ||||
Capitalized software, net | 7,041 | 3,372 | ||||
Goodwill | 104,651 | 83,954 | ||||
Intangible assets, net | 82,661 | 66,023 | ||||
Other assets | 3,644 | 1,605 | ||||
Total assets | $ | 218,499 | $ | 175,142 | ||
Liabilities and equity | ||||||
Liabilities | ||||||
Current liabilities | ||||||
Accounts payable | $ | 3,359 | $ | 4,114 | ||
Current portion of long-term debt | 5,000 | 5,000 | ||||
Accrued expenses and other current liabilities | 15,588 | 11,538 | ||||
Settlement obligations | 439 | 863 | ||||
Deferred revenue | 4,413 | 4,927 | ||||
Total current liabilities | 28,799 | 26,442 | ||||
Long-term debt, less current portion and debt issuance costs, net | 70,241 | 31,776 | ||||
Other long-term liabilities | 4,724 | 4,726 | ||||
Total liabilities | 103,764 | 62,944 | ||||
Commitments and contingencies | ||||||
Stockholders' equity | ||||||
Preferred stock, par value $0.0001 per share, 10,000,000 shares authorized; 0 shares issued and outstanding as of March 31, 2019 and September 30, 2018 | — | — | ||||
Class A common stock, par value $0.0001 per share, 150,000,000 shares authorized; 9,192,030 and 9,112,042 shares issued and outstanding as of March 31, 2019 and September 30, 2018, respectively | 1 | 1 | ||||
Class B common stock, par value $0.0001 per share, 40,000,000 shares authorized; 17,112,164 and 17,213,806 shares issued and outstanding as of March 31, 2019 and September 30, 2018, respectively | 2 | 2 | ||||
Additional paid-in-capital | 41,284 | 38,562 | ||||
Accumulated (deficit) earnings | (188 | ) | 736 | |||
Total Stockholders' equity | 41,099 | 39,301 | ||||
Non-controlling interest | 73,636 | 72,897 | ||||
Total equity | 114,735 | 112,198 | ||||
Total liabilities and stockholders' equity | $ | 218,499 | $ | 175,142 |
(Unaudited)
($ in thousands)
Six months ended March 31, | |||||||
2019 | 2018 | ||||||
Net cash provided by operating activities | $ | 11,424 | $ | 9,593 | |||
Net cash used in investing activities | $ | (44,945 | ) | $ | (30,106 | ) | |
Net cash provided by financing activities | $ | 34,343 | $ | 19,964 |
Reconciliation of GAAP to Non-GAAP Financial Measures
The Company believes that non-GAAP financial measures are important to enable investors to understand and evaluate its ongoing operating results. Accordingly,
Although non-GAAP financial measures are often used to measure the Company's operating results and assess its financial performance, they are not necessarily comparable to similarly titled measures of other companies due to potential inconsistencies in the method of calculation.
(Unaudited)
($ in thousands)
Three months ended March 31, | Six months ended March 31, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net income (loss) attributable to i3 Verticals, Inc. | $ | (1,102 | ) | $ | (6,836 | ) | $ | (924 | ) | $ | (7,168 | ) | |||
Net income attributable to non-controlling interest | (120 | ) | — | 2,053 | — | ||||||||||
Non-GAAP adjustments: | |||||||||||||||
Provision for (benefit from) income taxes | (136 | ) | 250 | 129 | (139 | ) | |||||||||
Offering-related expenses(1) | — | 124 | — | 124 | |||||||||||
Non-cash change in fair value of contingent consideration(2) | 2,502 | 1,747 | 2,153 | 2,129 | |||||||||||
Non-cash change in fair value of warrant liability(3) | — | 6,564 | — | 8,245 | |||||||||||
Equity-based compensation(4) | 1,363 | — | 2,314 | — | |||||||||||
Acquisition revenue adjustments(5) | 739 | — | 1,270 | — | |||||||||||
Acquisition-related expenses(6) | 261 | 220 | 621 | 447 | |||||||||||
Acquisition intangible amortization(7) | 3,205 | 2,370 | 6,110 | 4,630 | |||||||||||
Non-cash interest expense(8) | 232 | 248 | 465 | 465 | |||||||||||
Other taxes(9) | 187 | 6 | 190 | 41 | |||||||||||
Non-GAAP pro forma adjusted income before taxes | 7,131 | 4,693 | 14,381 | 8,774 | |||||||||||
Pro forma taxes at effective tax rate(10) | (1,783 | ) | (1,173 | ) | (3,595 | ) | (2,195 | ) | |||||||
Pro forma adjusted net income(11) | $ | 5,348 | $ | 3,520 | $ | 10,786 | $ | 6,579 | |||||||
Cash interest expense, net(12) | 923 | 2,370 | 1,604 | 4,541 | |||||||||||
Pro forma taxes at effective tax rate(10) | 1,783 | 1,173 | 3,595 | 2,195 | |||||||||||
Depreciation and internally developed software amortization(13) | 693 | 650 | 1,340 | 1,246 | |||||||||||
Adjusted EBITDA | $ | 8,747 | $ | 7,713 | $ | 17,325 | $ | 14,561 |
________
- Includes costs associated with forming
i3 Verticals, Inc. and other expenses directly related to the certain transactions as part of any offering. - Non-cash change in fair value of contingent consideration reflects the changes in management’s estimates of future cash consideration to be paid in connection with prior acquisitions from the amount estimated as of the later of the most recent balance sheet date forming the beginning of the income statement period or the original estimates made at the closing of the applicable acquisition.
- Non-cash change in warrant liability reflects the fair value change in certain warrants for the Company's common units associated with the Company's mezzanine notes in the aggregate principal amount of
$10.5 million . These warrants are accounted for as liabilities on the Company's consolidated balance sheets and were repaid with proceeds from its IPO. - Equity-based compensation expense consisted of
$1,363 thousand and$2,314 thousand related to stock options issued under the Company's 2018 Equity Incentive Plan during the three and six months endedMarch 31, 2019 , respectively. - Under GAAP, companies must adjust, as necessary, beginning balances of acquired deferred revenue to fair value as part of acquisition accounting as defined by GAAP. Acquisition revenue adjustments remove the effect of these adjustments to acquisition date fair value from acquisitions that have closed as of the date of this earnings release.
- Acquisition-related expenses are the professional service and related costs directly related to the Company's acquisitions and are not part of its core performance.
- Acquisition intangible amortization reflects amortization of intangible assets and software acquired through business combinations, acquired customer portfolios, acquired referral agreements and related asset acquisitions.
- Non-cash interest expense reflects amortization of deferred financing costs.
- Other taxes consist of franchise taxes, commercial activity taxes and other non-income based taxes. Taxes related to salaries or employment are not included.
- Pro forma corporate income tax expense is based on Non-GAAP adjusted income before taxes and is calculated using a tax rate of 25.0% and 25.0% for 2019 and 2018, respectively, based on blended federal and state tax rates, considering the Tax Reform Act for 2018.
- Pro forma adjusted net income assumes that the effect of the Reorganization Transactions and the Company's IPO occurred prior to the year ended
September 30, 2018 , and that all net income during that period was available to the Class A common shareholders. - Cash interest expense, net represents all interest expense recorded on the Company's statement of operations other than non-cash interest expense, which represents amortization of deferred financing costs.
- Depreciation and internally developed software amortization reflects depreciation on the Company's property, plant and equipment, net, and amortization expense on its internally developed capitalized software.
(Unaudited)
($ in ones)
Three months ended March 31, 2019 |
Six months ended March 31, 2019 |
||||||
Diluted net loss available to Class A common stock per share | $ | (0.12 | ) | $ | (0.10 | ) | |
Pro forma adjusted diluted earnings per share (non-GAAP)(1) | $ | 0.20 | $ | 0.40 | |||
Pro forma weighted average shares of adjusted diluted Class A common stock outstanding(2) | 27,289,888 | 27,124,176 |
__________
- Pro forma adjusted diluted earnings per share is calculated using pro forma adjusted net income and the pro forma weighted average shares of adjusted diluted Class A common stock outstanding.
- Pro forma weighted average shares of adjusted diluted Class A common stock outstanding include 17,112,164 outstanding shares of Class A common stock issuable upon the exchange of Common Units in i3
Verticals, LLC and 1,290,674 and 1,162,581 shares of unvested Class A common stock and options for the three and six months endedMarch 31, 2019 , respectively.
(Unaudited)
($ in thousands)
Three months ended March 31, | Six months ended March 31, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Revenue | $ | 85,394 | $ | 77,699 | $ | 170,262 | $ | 154,920 | |||||||
Acquisition revenue adjustments(1) | 739 | — | 1,270 | — | |||||||||||
Interchange and network fees | (54,685 | ) | (50,634 | ) | (110,514 | ) | (102,872 | ) | |||||||
Adjusted Net Revenue | $ | 31,448 | $ | 27,065 | $ | 61,018 | $ | 52,048 |
__________
- Under GAAP, companies must adjust, as necessary, beginning balances of acquired deferred revenue to fair value as part of acquisition accounting as defined by GAAP. Acquisition revenue adjustments remove the effect of these adjustments to acquisition date fair value from acquisitions that have closed as of the date of this earnings release.
Source: i3 Verticals