DAYFORCE, INC. Item 2.02 Results of Operations and Financial Condition.
OnFebruary 9, 2022 , the Company issued a press release announcing its unaudited financial results for the fourth quarter and fiscal year endedDecember 31, 2021 ("Press Release") and published a stockholder letter (the "Stockholder Letter") including such financial results. The Press Release and Stockholder Letter were furnished pursuant to Items 2.02 and 9.01 of the Original Form 8-K. It has subsequently been identified that the total adjusted operating profit (loss) amounts included in tables presented in both the Press Release and the Stockholder Letter were incorrect. Due to an error occurring in the preparation of the schedules, the amounts of total adjusted operating profit (loss) for the three and twelve months endedDecember 31, 2021 were presented as($13.6) million and($157.7) million , respectively, and for the three and twelve months endedDecember 31, 2020 were presented as($63.1) million and($95.3) million , respectively, within the Reconciliation of GAAP to Non-GAAP Financial Measures section of the Press Release and the Stockholder Letter. The corrected amounts of total adjusted operating profit (loss) are$18.8 million and$86.7 million for the three months and twelve year endedDecember 31, 2021 , respectively, and$19.3 million and$110.9 million for the three and twelve months endedDecember 31, 2020 , respectively. A corrected version of each table contained in the Press Release and the Stockholder Letter that were impacted by this error are included below. Three Months Ended December 31, 2021 As Share-based Severance reported compensation charges Other (a) Adjusted (b) (Dollars in millions, except per share data) Cost of revenue: Recurring Cloud$ 54.3 $ 2.8$ 0.3 $ -$ 51.2 Bureau 17.0 0.4 0.1 - 16.5 Total recurring 71.3 3.2 0.4 - 67.7 Professional services and other 53.7 2.4 0.1 - 51.2 Product development and management 39.8 4.8 0.1 - 34.9 Depreciation and amortization 13.4 - - - 13.4 Total cost of revenue 178.2 10.4 0.6 - 167.2 Sales and marketing 64.0 3.7 0.3 - 60.0 General and administrative 37.3 16.8 0.7 (16.3 ) 36.1 Operating profit (loss) 2.6 30.9 1.6 (16.3 ) 18.8 Other expense (income), net 2.7 - - 4.4 (1.7 ) Depreciation and amortization 18.2 - - - 18.2 EBITDA$ 18.1 $ 30.9$ 1.6 $ (11.9 ) $ 38.7 Interest expense, net 10.4 - - - 10.4 Income tax (benefit) expense (c) (1.0 ) - - (1.8 ) 0.8 Depreciation and amortization 18.2 - - - 18.2 Net (loss) income$ (9.5 ) $ 30.9$ 1.6 $ (13.7 ) $ 9.3 Net (loss) income per share- basic (d)$ (0.06 ) $ 0.20$ 0.01 $ (0.09 ) $ 0.06 Net (loss) income per share- diluted (d)$ (0.06 ) $ 0.20$ 0.01 $ (0.09 ) $ 0.06 a) Other includes net gain of$19.1 million primarily as a result of the sale of ourSt. Petersburg, Florida facility, foreign exchange loss, restructuring consulting fees, the difference between the historical five-year average pension expense and the current period actuarially determined pension expense associated with the planned termination of the frozenU.S. pension plan and related changes in investment strategy associated with protecting the now fully funded status, and the impact of the fair value adjustment for the DataFuzion contingent consideration. b) The Adjusted amount is a non-GAAP financial measure. c) Income tax effects have been calculated based on the statutory tax rates in effect in theU.S. and foreign jurisdictions during the period. d) GAAP and Adjusted basic and diluted net (loss) income per share are calculated based upon 151,465,292 and 157,799,902 weighted-average shares of common stock, respectively.
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Three Months Ended December 31, 2020
As Share-based Severance
reported compensation charges Other (a) Adjusted (b)
(Dollars in millions, except per share data)
Cost of revenue:
Recurring
Cloud $ 44.7 $ 1.4 $ 0.2 $ - $ 43.1
Bureau 12.8 0.2 - - 12.6
Total recurring 57.5 1.6 0.2 - 55.7
Professional services and other 43.0 1.3 - - 41.7
Product development and
management 26.2 3.5 0.3 - 22.4
Depreciation and amortization 10.6 - - - 10.6
Total cost of revenue 137.3 6.4 0.5 - 130.4
Sales and marketing 49.4 2.0 1.9 - 45.5
General and administrative 58.0 12.0 0.4 18.0 27.6
Operating (loss) profit (21.9 ) 20.4 2.8 18.0 19.3
Other (income) expense, net - - - (1.1 ) 1.1
Depreciation and amortization 14.9 - - - 14.9
EBITDA $ (7.0 ) $ 20.4 $ 2.8 $ 16.9 $ 33.1
Interest expense, net 5.7 - - - 5.7
Income tax benefit (c) (10.3 ) - - (8.8 ) (1.5 )
Depreciation and amortization 14.9 - - - 14.9
Net (loss) income $ (17.3 ) $ 20.4 $ 2.8 $ 8.1 $ 14.0
Net (loss) income per share-
basic (d) $ (0.12 ) $ 0.14 $ 0.02 $ 0.05 $ 0.09
Net (loss) income per share-
diluted (d) $ (0.12 ) $ 0.14 $ 0.02 $ 0.05 $ 0.09
a)
Other includes lease abandonment charges, intercompany foreign exchange gain,
and restructuring consulting fees.
b)
The Adjusted amount is a non-GAAP financial measure.
c)
Income tax effects have been calculated based on the statutory tax rates in
effect in the U.S. and foreign jurisdictions during the period.
d)
GAAP and Adjusted basic and diluted net (loss) income per share are calculated
based upon 148,086,778 weighted-average shares of common stock.
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Twelve Months Ended December 31, 2021
As Share-based Severance
reported compensation charges Other (a) Adjusted (b)
(Dollars in millions, except per share data)
Cost of revenue:
Recurring
Cloud $ 197.7 $ 11.0 $ 0.5 $ - $ 186.2
Bureau 64.7 1.9 1.5 - 61.3
Total recurring 262.4 12.9 2.0 - 247.5
Professional services and other 194.6 9.5 0.2 - 184.9
Product development and
management 134.0 18.0 0.6 - 115.4
Depreciation and amortization 50.9 - - - 50.9
Total cost of revenue 641.9 40.4 2.8 - 598.7
Sales and marketing 218.5 13.8 1.9 - 202.8
General and administrative 199.3 62.6 2.7 (2.0 ) 136.0
Operating (loss) profit (35.5 ) 116.8 7.4 (2.0 ) 86.7
Other expense, net 18.9 - - 17.2 1.7
Depreciation and amortization 77.5 - - - 77.5
EBITDA $ 23.1 $ 116.8 $ 7.4 $ 15.2 $ 162.5
Interest expense, net 35.9 - - - 35.9
Income tax (benefit) expense (c) (14.9 ) - - (23.6 ) 8.7
Depreciation and amortization 77.5 - - - 77.5
Net (loss) income $ (75.4 ) $ 116.8 $ 7.4 $ (8.4 ) $ 40.4
Net (loss) income per share-
basic (d) $ (0.50 ) $ 0.78 $ 0.05 $ (0.06 ) $ 0.27
Net (loss) income per share-
diluted (d) $ (0.50 ) $ 0.74 $ 0.05 $ (0.06 ) $ 0.26
a)
Other includes net gain of $19.1 million primarily as a result of the sale of
our St. Petersburg, Florida facility, foreign exchange loss, restructuring
consulting fees, the difference the historical five-year average pension expense
and the current period actuarially determined pension expense associated with
the planned termination of the frozen U.S. pension plan and related changes in
investment strategy associated with protecting the now fully funded status, and
the impact of the fair value adjustment for the DataFuzion contingent
consideration.
b)
The Adjusted amount is a non-GAAP financial measure.
c)
Income tax effects have been calculated based on the statutory tax rates in
effect in the U.S. and foreign jurisdictions during the period.
d)
GAAP and Adjusted basic and diluted net (loss) income per share are calculated
based upon 150,402,321 and 156,842,934 weighted-average shares of common stock,
respectively.
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Twelve Months Ended December 31, 2020
As Share-based Severance
reported compensation charges Other (a) Adjusted (b)
(Dollars in millions, except per share data)
Cost of revenue:
Recurring
Cloud $ 166.9 $ 5.0 $ 1.4 $ - $ 160.5
Bureau 46.4 1.1 0.4 - 44.9
Total recurring 213.3 6.1 1.8 - 205.4
Professional services and other 163.7 3.8 0.9 - 159.0
Product development and
management 83.7 8.7 1.5 - 73.5
Depreciation and amortization 40.5 - - - 40.5
Total cost of revenue 501.2 18.6 4.2 - 478.4
Sales and marketing 165.6 8.0 3.3 - 154.3
General and administrative 167.9 42.3 2.2 24.5 98.9
Operating profit 7.8 68.9 9.7 24.5 110.9
Other expense (income), net 2.7 - - (1.0 ) 3.7
Depreciation and amortization 51.8 - - - 51.8
EBITDA $ 56.9 $ 68.9 $ 9.7 $ 23.5 $ 159.0
Interest expense, net 25.1 - - - 25.1
Income tax (benefit) expense (c) (16.0 ) - - (25.0 ) 9.0
Depreciation and amortization 51.8 - - - 51.8
Net (loss) income $ (4.0 ) $ 68.9 $ 9.7 $ (1.5 ) $ 73.1
Net (loss) income per share- $ (0.03 ) $ 0.47 $ 0.07 $ (0.01 ) $ 0.50
basic (d)
Net (loss) income per share- $ (0.03 ) $ 0.47 $ 0.07 $ (0.01 ) $ 0.50
diluted (d)
a)
Other includes lease abandonment charges, intercompany foreign exchange loss,
restructuring consulting fees, and recovery of duplicate payments associated
with the 2019 isolated service incident.
b)
The Adjusted amount is a non-GAAP financial measure.
c)
Income tax effects have been calculated based on the statutory tax rates in
effect in the U.S. and foreign jurisdictions during the period.
d)
GAAP and Adjusted basic and diluted net income (loss) per share are calculated
based upon 146,774,471 weighted-average shares of common stock.
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