MESA, Arizona, Nov. 8, 2018 /PRNewswire/ — Verra Mobility Corporation (NASDAQ: VRRM) (the “Company” or “Verra Mobility”) a leading provider of smart mobility technology solutions, today announced financial results for the quarter ended September 30, 2018.

Verra Mobility_2018 (PRNewsfoto/Verra Mobility)

Total revenue for the third quarter increased to $107.6 million compared to $56.1 million for third quarter of 2017.  During 2018, the Company completed two acquisitions that together contributed $40.2 million to the year-over-year revenue growth.  Excluding the impact of the acquisitions, total revenue grew by $11.3 million, an increase of 20% over the same quarter in the prior year.

“During the third quarter we executed on our strategy of growing the core business, while integrating two strategic acquisitions and investing in new product offerings,” said David Roberts, Chief Executive Officer of Verra Mobility.  “We are committed to serving our customers and communities by making transportation safer, easier and more connected.”

The Company reports its results of operations based on two operating segments: Commercial Services and Government Solutions. Commercial Services delivers market leading automated toll and violations management and title and registration solutions to rental car companies, fleet management companies and other large fleet owners. Government Solutions delivers market leading automated safety solutions to municipalities and school districts, including services and technology that enable photo enforcement via road safety camera programs related to red light, speed, school bus, and city bus lanes.  

Third Quarter 2018 Financial Highlights

  • Generated Net Income of $6.5 million
  • Adjusted EBITDA of $61.9 million is 57.6% of total revenue
  • Commercial Services segment generated revenue of $72.0 million and segment profit of $49.4 million
  • Government Solutions segment generated revenue of $35.6 million and segment profit of $12.5 million
  • Operating expenses as a percentage of total revenue were 25.9% compared to 38.6% in the prior year
  • Cash flow from operations was $46.1 million

David Roberts, Verra Mobility’s CEO, remarked, “Our recent acquisitions are performing well and we are achieving our synergy targets. Segment profit margins for Commercial Services were nearly 69% for the quarter.  We expect to end the year strong and ahead of revenue and profit estimates.”

Quarterly Conference Call

Verra Mobility will host a conference call today at 3:00 p.m. Mountain Time (5:00 p.m. Eastern Time) to review the Company’s financial results for the quarter ended September 30, 2018.  To access this call, dial (800) 289-0438 for the U.S. or Canada, or (323) 794-2423 for international callers.  A live webcast of the conference call will be accessible from the Investors section of Verra Mobility’s website at http://ir.verramobility.com, and a recording will be archived and accessible at http://ir.verramobility.com. An audio replay of this conference call will also be available through November 22, 2018, by dialing (844) 512-2921 for the U.S. or Canada, or (412) 317-6671 for international callers, and entering passcode 7026761.

Forward-Looking Statements

This press release contains forward-looking statements which address The Company’s expected future business and financial performance, and often contain words such as “goal,” “target,” “future,” “estimate,” “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “project,” “may,” “should,” or “will” and similar expressions. Examples of forward-looking statements include, among others, statements regarding the benefits of the Company’s strategic acquisitions; changes in the market for our products and services; expected operating results, such as revenue growth; expansion plans and opportunities; and earnings guidance related to 2018 financial and operational metrics. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those currently anticipated. Risks and uncertainties that may affect future results include those that are described from time to time in the Company’s filings with the Securities and Exchange Commission (“SEC”), which are available on the Company’s Investor Relations website, http://ir.verramobility.com, and on the SEC website, www.sec.gov. These forward-looking statements represent the judgment of the Company, as of the date of this release, and Verra Mobility disclaims any intent or obligation to update forward-looking statements. This press release should be read in conjunction with the information included in the Company’s other press releases, reports and other filings with the SEC. Understanding the information contained in these filings is important in order to fully understand the Company’s reported financial results and our business outlook for future periods.

Non-GAAP Financial Information

In addition to disclosing financial results that are determined in accordance with U.S. generally accepted accounting principles (“GAAP“), the Company also discloses certain non-GAAP financial information in this press release. These financial measures are not recognized measures under GAAP and they are not intended to be and should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. EBITDA, adjusted EBITDA and adjusted EBITDA margin are non-GAAP financial measures as defined by SEC rules. This non-GAAP financial information may be determined or calculated differently by other companies. Reconciliations of these non-GAAP measurements to the most directly comparable GAAP financial measurements have been provided in the financial statement tables included in this press release, and investors are encouraged to review the reconciliation.

About Verra Mobility

Verra Mobility is committed to developing and using the latest in technology and data intelligence to help make transportation safer and easier. As a global company, Verra Mobility sits at the center of the mobility ecosystem – one that brings together vehicles, devices, information, and people to solve the most complex challenges faced by our customers and the constituencies they serve.

Verra Mobility serves the world’s largest commercial fleets and rental car companies to manage tolling transactions and violations for millions of vehicles. A leading provider of connected systems, Verra Mobility processes millions of transactions each year through connectivity with more than 50 individual tolling authorities and more than 400 issuing authorities. Verra Mobility also fosters the development of safe cities, partnering with law enforcement agencies, transportation departments and school districts across North America operating thousands of red-light, speed, bus lane and school bus stop arm safety cameras. For more information, visit www.verramobility.com.

Investor Contact
Marc P. Griffin
ICR, Inc., for Verra Mobility
646-277-1290
IR@verramobility.com 

VERRA MOBILITY CORPORATION AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

September 30,

December 31,

2018

2017

Assets

Current assets:

Cash and cash equivalents

$         51,948,613

$        8,724,945

Restricted cash 

1,727,645

1,784,665

Accounts receivable, net

76,215,796

60,180,536

Unbilled receivables

12,546,409

4,802,074

Prepaid expenses and other current assets

17,750,138

15,788,912

Total current assets

160,188,601

91,281,132

Installation and service parts, net

11,368,887

9,066,913

Property and equipment, net

67,196,125

65,370,696

Intangible assets, net

538,103,690

203,749,221

Goodwill

564,394,454

294,414,522

Other non-current assets

2,305,216

982,731

Total assets

$    1,343,556,973

$    664,865,215

Liabilities and stockholders’ equity

Current liabilities:

Accounts payable

$         47,697,160

$      20,158,977

Accrued liabilities

15,763,074

10,086,622

Current portion of long-term debt

8,400,000

3,250,000

Total current liabilities

71,860,234

33,495,599

Long term debt, net of current portion and deferred financing costs

980,058,924

425,439,034

Other long-term liabilities

3,176,764

2,689,145

Asset retirement obligations

6,730,721

6,373,125

Deferred income taxes, net

41,790,046

49,603,691

Total Liabilities

1,103,616,689

517,600,594

Stockholders’ equity:

  Common stock, $.01 par value, 1,000 shares authorized with 100 shares issued and outstanding at September 30, 2018 and December 31, 2017

1

1

  Additional paid-in capital

246,582,030

129,026,398

  Retained earnings (accumulated deficit)

(2,201,891)

18,238,222

  Accumulated other comprehensive loss

(4,439,856)

Total stockholders’ equity 

239,940,284

147,264,621

Total liabilities and stockholders’ equity

$    1,343,556,973

$    664,865,215

 

VERRA MOBILITY CORPORATION AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME (LOSS)

 Successor 

 Three months 

 Three months 

 ended 

 ended 

September 30, 2018

September 30, 2017

 Service revenue 

$               105,203,673

$                 55,608,693

 Product sales 

2,398,807

480,699

 Total revenue 

107,602,480

56,089,392

 Cost of service revenue 

1,735,420

838,211

 Cost of product sales 

1,375,105

284,258

 Operating expenses 

27,819,681

21,703,331

 Selling, general and administrative expenses 

21,687,265

15,830,550

 Depreciation, amortization and (gain) loss on disposal of assets, net 

28,789,672

14,221,542

 Total costs and expenses 

81,407,143

52,877,892

 Income from operations 

26,195,337

3,211,500

 Interest expense 

20,312,956

8,947,089

 Other income, net 

(2,942,255)

(1,073,966)

 Total other expense 

17,370,701

7,873,123

 Net income (loss) before income tax provision (benefit) 

8,824,636

(4,661,623)

 Income tax provision (benefit) 

2,311,923

(1,314,474)

 Net income (loss) 

6,512,713

(3,347,149)

Other comprehensive loss:

 Foreign currency translation adjustment 

(727,998)

  Total comprehensive income (loss)

$                   5,784,715

$                 (3,347,149)

 

VERRA MOBILITY CORPORATION AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME (LOSS)

 Successor 

Predecessor

 Nine months 

 Four months 

 Five months 

 ended 

 ended 

 ended 

September 30, 2018

September 30, 2017

May 31, 2017

 Service revenue 

$               271,253,648

$                 74,386,326

$     92,530,939

 Product sales 

3,786,660

688,325

1,340,191

 Total revenue 

275,040,308

75,074,651

93,871,130

 Cost of service revenue 

4,217,444

1,123,209

1,369,445

 Cost of product sales 

2,425,132

471,197

963,504

 Operating expenses 

80,300,635

28,767,893

35,967,664

 Selling, general and administrative expenses 

82,550,861

30,049,143

40,884,179

 Depreciation, amortization and (gain) loss on disposal of assets, net 

74,829,641

19,243,972

12,613,143

 Total costs and expenses 

244,323,713

79,655,414

91,797,935

 Income (loss) from operations 

30,716,595

(4,580,763)

2,073,195

 Interest expense 

52,538,757

11,835,402

875,102

 Loss on extinguishment of debt 

10,151,074

 Other income, net 

(7,000,884)

(1,335,249)

(1,294,299)

 Total other expense (income) 

55,688,947

10,500,153

(419,197)

 Net (loss) income before income tax (benefit) provision 

(24,972,352)

(15,080,916)

2,492,392

 Income tax (benefit) provision 

(4,532,239)

(4,137,563)

1,252,793

   Net (loss) income 

(20,440,113)

(10,943,353)

1,239,599

Other comprehensive loss:

 Foreign currency translation adjustment 

(4,439,856)

   Total comprehensive (loss) income

$               (24,879,969)

$               (10,943,353)

$       1,239,599

 

VERRA MOBILITY CORPORATION AND SUBSIDIARIES

UNAUDITED STATEMENTS OF SEGMENT PROFITABILITY

Successor

 

For the three months ended September 30, 2018

Government

 Solutions 

Commercial

 Services 

Corporate and

 Other 

 

 Total 

 Service revenue 

$       33,231,500

$       71,972,173

$                               –

$        105,203,673

 Product sales 

2,398,807

2,398,807

 Total revenue 

35,630,307

71,972,173

107,602,480

 Cost of service revenue 

648,277

1,087,143

1,735,420

 Cost of product sales 

1,375,105

1,375,105

 Operating expenses 

13,850,461

13,969,220

27,819,681

 Selling, general and administrative expenses 

7,240,689

10,439,986

4,006,590

21,687,265

 Other (income) expense, net 

(26,123)

(2,943,006)

26,874

(2,942,255)

 Segment Profit (Loss) 

$       12,541,898

$       49,418,830

$               (4,033,464)

$          57,927,264

 Segment profit (loss) 

$       12,541,898

$       49,418,830

$               (4,033,464)

$          57,927,264

 Depreciation, amortization, impairment, and (gain) loss on disposal of assets, net 

28,789,672

28,789,672

 Interest expense 

20,312,956

20,312,956

 Loss on extinguishment of debt 

 Income (loss) before income taxes 

$       12,541,898

$       49,418,830

$             (53,136,092)

$            8,824,636

Successor

 

For the three months ended September 30, 2017

Government

 Solutions 

Commercial

 Services 

Corporate and

 Other 

 

 Total 

 Service revenue 

$       32,373,306

$       23,235,387

$                               –

$       55,608,693

 Product sales 

480,699

480,699

 Total revenue 

$       32,854,005

$       23,235,387

$                               –

$       56,089,392

 Cost of service revenue 

641,407

196,804

838,211

 Cost of product sales 

284,258

284,258

 Operating expenses 

14,828,550

6,874,781

21,703,331

 Selling, general and administrative expenses 

5,522,603

5,994,795

4,313,152

15,830,550

 Other (income) expense, net 

(26,925)

(1,049,475)

2,434

(1,073,966)

 Segment Profit (Loss) 

$       11,604,112

$       11,218,482

$               (4,315,586)

$       18,507,008

 Segment profit (loss) 

$       11,604,112

$       11,218,482

$               (4,315,586)

$       18,507,008

 Depreciation, amortization, impairment, and (gain) loss on disposal of assets, net 

14,221,542

14,221,542

 Interest 

8,947,089

8,947,089

 Income (loss) before income taxes 

$       11,604,112

$       11,218,482

$             (27,484,217)

$        (4,661,623)

 

VERRA MOBILITY CORPORATION AND SUBSIDIARIES

UNAUDITED STATEMENTS OF SEGMENT PROFITABILITY

Successor

 

For the nine months ended September 30, 2018

Government

 Solutions 

Commercial

 Services 

Corporate and

 Other 

 

 Total 

 Service revenue 

$        107,063,888

$        164,189,760

$                               –

$        271,253,648

 Product sales 

3,786,660

3,786,660

 Total revenue 

110,850,548

164,189,760

275,040,308

 Cost of service revenue 

2,163,458

2,053,986

4,217,444

 Cost of product sales 

2,425,132

2,425,132

 Operating expenses 

42,701,929

37,598,706

80,300,635

 Selling, general and administrative expenses 

20,585,732

42,992,315

18,972,814

82,550,861

 Other (income) expense, net 

(88,853)

(6,911,623)

(408)

(7,000,884)

 Segment Profit (Loss) 

$          43,063,150

$          88,456,376

$             (18,972,406)

$        112,547,120

 Segment profit (loss) 

$          43,063,150

$          88,456,376

$             (18,972,406)

$        112,547,120

 Depreciation, amortization, impairment, and (gain) loss on disposal of assets, net 

74,829,641

74,829,641

 Interest expense 

52,538,757

52,538,757

 Loss on extinguishment of debt 

10,151,074

10,151,074

 Income (loss) before income taxes 

$          43,063,150

$          88,456,376

$           (156,491,878)

$        (24,972,352)

Successor

 

For the four months ended September 30, 2017

Government

 Solutions 

Commercial

 Services 

Corporate and

 Other 

 

 Total 

 Service revenue 

$       43,746,847

$       30,639,479

$                               –

$         74,386,326

 Product sales 

688,325

688,325

 Total revenue 

$       44,435,172

$       30,639,479

$                               –

$         75,074,651

 Cost of service revenue 

876,729

246,480

1,123,209

 Cost of product sales 

471,197

471,197

 Operating expenses 

19,702,233

9,065,660

28,767,893

 Selling, general and administrative expenses 

7,244,266

7,863,415

14,941,462

30,049,143

 Other (income) expense, net 

(33,346)

(1,304,337)

2,434

(1,335,249)

 Segment Profit (Loss) 

$       16,174,093

$       14,768,261

$             (14,943,896)

$         15,998,458

 Segment profit (loss) 

$       16,174,093

$       14,768,261

$             (14,943,896)

$         15,998,458

 Depreciation, amortization, impairment, and (gain) loss on disposal of assets, net 

19,243,972

19,243,972

 Interest 

11,835,402

11,835,402

 Income (loss) before income taxes 

$       16,174,093

$       14,768,261

$             (46,023,270)

$        (15,080,916)

 

VERRA MOBILITY CORPORATION AND SUBSIDIARIES

UNAUDITED STATEMENTS OF SEGMENT PROFITABILITY

Predecessor

 

For the five months ended May 31, 2017

Government

 Solutions 

Commercial

 Services 

Corporate and

 Other 

 

 Total 

 Service revenue 

$       57,021,850

$       35,509,089

$                               –

$         92,530,939

 Product sales 

1,340,191

1,340,191

 Total revenue 

58,362,041

35,509,089

93,871,130

 Cost of service revenue 

1,174,923

194,522

1,369,445

 Cost of product sales 

963,504

963,504

 Operating expenses 

24,702,104

11,265,560

35,967,664

 Selling, general and administrative expenses 

9,230,714

9,881,849

21,771,616

40,884,179

 Other (income) expense, net 

(48,416)

(1,243,281)

(2,602)

(1,294,299)

 Segment Profit (Loss) 

$       22,339,212

$       15,410,439

$             (21,769,014)

$         15,980,637

 Segment profit (loss) 

$       22,339,212

$       15,410,439

$             (21,769,014)

$         15,980,637

 Depreciation, amortization, impairment, and (gain) loss on disposal of assets, net 

12,613,143

12,613,143

 Interest 

875,102

875,102

 Income (loss) before income taxes 

$       22,339,212

$       15,410,439

$             (35,257,259)

$           2,492,392

 

VERRA MOBILITY CORPORATION AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 Successor 

Predecessor

 Nine months 

 Four months 

 Five months 

 ended 

 ended 

 ended 

September 30, 2018

September 30, 2017

May 31, 2017

Cash flows from operating activities:

Net (loss) income

$               (20,440,113)

$               (10,943,353)

$       1,239,599

Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:

  Depreciation and amortization

74,838,445

19,256,429

12,574,006

  Amortization of deferred financing costs and discount

6,932,724

948,846

143,241

  Loss on extinguishment of debt

10,151,074

  Accretion expense

292,580

87,193

106,404

  (Gain) loss on disposal of assets

(8,804)

(12,457)

39,137

  Installation and service parts obsolescence and maintenance expense

431,834

165,096

177,124

  Bad debt expense

4,355,700

2,185,435

2,181,957

  Deferred income taxes

(16,514,331)

(4,482,852)

(3,326,978)

Changes in operating assets and liabilities:

0

  Accounts receivable, net

(10,703,263)

(13,467,878)

6,107,664

  Unbilled receivables

(7,744,334)

(1,974,786)

1,945,493

  Prepaid expense and other current assets

3,750,798

(8,632,290)

(1,581,750)

  Deposits and other non-current assets

(1,304,686)

421,916

322,260

  Restricted cash

57,019

(619,742)

215,478

  Accounts payable and accrued liabilities

1,651,391

2,429,653

22,413,747

  Other liabilities

364,926

(78,008)

(508,181)

  Net cash provided by (used in) operating activities

46,110,960

(14,716,798)

42,049,201

Cash flows from investing activities

  Purchases of installation and service parts and property and equipment

(19,919,129)

(10,872,392)

(8,952,667)

  Proceeds from damaged property and equipment

296,264

66,750

41,909

  Cash proceeds from the sale of assets

5,154

9,975

124,694

  Acquisition of business, net of cash acquired

(525,361,663)

(539,082,979)

Net cash used in investing activities

(544,979,374)

(549,878,646)

(8,786,064)

Cash flows from financing activities:

  Borrowings on revolver

468,306

13,000,000

40,752,179

  Repayments on revolver

(468,306)

(68,213,359)

  Predecessor payment of debt issuance costs

(30,000)

  Borrowings of long-term debt

444,250,000

  Payment of debt issuance costs

(30,351,948)

(15,783,188)

  Repayments of long-term debt

(452,575,000)

(812,500)

  Borrowings of long-term debt

1,033,800,000

  Payment of debt extinguishment costs

(8,186,961)

  Cash received pursuant to the Merger

129,026,399

Net cash provided by (used in) financing activities

542,686,091

569,680,711

(27,491,180)

Effect of exchange rate changes on cash and cash equivalents

(594,009)

Net increase in cash and cash equivalents 

43,223,668

5,085,267

5,771,957

Cash and cash equivalents-Beginning of period

8,724,945

2,900,970

Cash and cash equivalents-End of period

$                 51,948,613

$                   5,085,267

$       8,672,927

Supplemental disclosure of cash flow information:

  Cash paid (refunded) for income taxes, net

$                      856,815

$                   9,162,890

$         (211,030)

  Cash paid for interest

45,238,245

10,529,236

836,236

Supplemental non-cash investing and financing activities:

  Capital contribution received in Parent common stock and subsequently exchanged in acquisition of business

$               117,555,632

$                                 –

$                      –

  Payable to seller in connection with business acquisition

11,337,113

 

VERRA MOBILITY CORPORATION AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Accumulated

Retained

Other

Total

Common Stock

Additional

Earnings

Comprehensive

Stockholders’ 

Shares

Amount

Paid-in-Capital

(accumulated deficit)

Loss

Equity

Balance as of December 31, 2017

100

$          1

$       129,026,398

$                18,238,222

$                          –

$    147,264,621

Net loss

(20,440,113)

(20,440,113)

Foreign currency translation adjustment

(4,439,856)

(4,439,856)

Capital contributions received in Parent common stock

117,555,632

117,555,632

Balance as of September 30, 2018

100

$          1

$       246,582,030

$                 (2,201,891)

$         (4,439,856)

$    239,940,284

 

VERRA MOBILITY CORPORATION AND SUBSIDIARIES

ADJUSTED EBITDA RECEONCILIATION

Successor

Successor

Successor

Successor

Predecessor

For the Three
Months Ended
September 30,

2018

For the Three
Months Ended
September 30,
2017

For the Nine
Months Ended
September 30,
2018

For the Four
Months Ended
September 30,
2017

For the Five
Months Ended
May 31,
2017

($ in thousands)

Net income (loss)

$             6,513

$            (3,347)

$          (20,440)

$          (10,943)

$             1,240

Interest expense

20,313

8,947

52,539

11,835

875

Income tax provision expense (benefit)

2,312

(1,314)

(4,532)

(4,138)

1,253

Depreciation and amortization

28,792

14,234

74,838

19,256

12,574

EBITDA

57,930

18,520

102,405

16,011

15,942

Transaction and other related expenses(i)

1,669

21

25,589

10,055

21,772

Transformation expenses(ii)

905

2,462

8,039

2,462

Loss on extinguishment of debt(iii)

10,151

Sponsor Fees and expenses(iv)

1,433

1,829

4,133

2,424

Non-cash amortization of contract inducement (v)

277

Adjusted EBITDA

$           61,936

$           22,833

$         150,316

$           30,953

$           37,991

Adjusted EBITDA Margin %

57.6%

40.7%

54.7%

41.2%

40.5%

(i)

Adjustments to add back deal fees incurred in relation to the Platinum’s acquisition of ATS in May 2017 and Verra’s acquisitions of HTA and EPC in March and April 2018, respectively.  Consists primarily of acquisition services to advisors, professional fees and other expenses

(ii)

One-time costs including costs for strategy consultants, procurement optimization and IT optimization

(iii)

Costs incurred to refinance the Company’s credit facility and term loans.  Includes prepayment penalties, the write-off of deferred financing costs and lender and third-party costs to issue the new debt

(iv)

Sponsor management fees paid to Platinum

(v)

Adjustment for amortization of a tolling contract with a major RAC

BASIS of Presentation

On May 31, 2017, the Company was acquired by Greenlight Acquisition Corporation (“Acquirer”) pursuant to the Agreement and Plan of Merger, dated April 15, 2017 by and among the Company, Greenlight Merger Corporation, a wholly-owned subsidiary of Acquirer, (“Merger Sub”) and Acquirer whereby the Company merged with and into Merger Sub with the former surviving (the “Merger”). Acquirer is ultimately owned by certain private equity investment vehicles sponsored by Platinum Equity, LLC.

Pursuant to the Merger, a new basis of accounting at fair value was established in accordance with U.S. GAAP under Accounting Standards Codification (“ASC”) Topic 805, Business Combinations.  The new stepped-up basis was pushed down by Acquirer to the Company.   The consolidated financial statements and footnotes contained herein are presented in distinct periods to indicate the application of two different bases of accounting between the periods presented. The period from January 1, 2017 to May 31, 2017 has been labeled “Predecessor” and has been prepared using the historical basis of accounting of the Predecessor. The periods from June 1, 2017 to September 30, 2017 and from January 1, 2018 to September 30, 2018 have been labeled Successor. The accompanying condensed consolidated statements of operations, cash flows and certain footnotes include a black line division separating the Predecessor Period from the Successor Period. As a result of purchase accounting, the pre-Merger and post-Merger condensed consolidated statements of operations and cash flows are not comparable.

Segment profit (loss) is based on revenues and income (loss) from operations before depreciation, amortization, impairment and gain (loss) on disposal of assets and after other income, net. Depreciation, amortization, impairment and gain (loss) on disposal of assets, interest expense, loss on extinguishment of debt and income taxes are not indicative of operating performance, and, as a result are not included in the operating and reportable segments. Other income, net consists primarily of credit card rebates earned on the prepayment of tolls and therefore included in Segment profit (loss). There are no significant non-cash items reported in Segment profit (loss).

EBITDA and adjusted EBITDA.

EBITDA is defined as net income, net of tax (if applicable), interest expense, income taxes, depreciation and amortization.  Adjusted EBITDA further excludes certain non-cash expenses, loss on extinguishment of debt and other transactions that management believes are not indicative of our business. Because EBITDA and adjusted EBITDA, as defined, exclude some but not all items that affect our cash flow from operating activities, they may not be comparable to similarly titled performance measures presented by other companies. EBITDA and adjusted EBITDA margins are calculated as EBITDA and adjusted EBITDA, respectively, divided by total revenues expressed as a percentage.

We present EBITDA and adjusted EBITDA because we believe they provide useful information regarding our ability to meet our future debt payment requirements, capital expenditures and working capital requirements and an overall evaluation of our financial condition. EBITDA and adjusted EBITDA have certain limitations as analytical tools and should not be used as substitutes for net income, cash flows from operations, or other consolidated income or cash flow data prepared in accordance with GAAP.

 

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SOURCE Verra Mobility