Three Months Ended September 30, |
Nine Months Ended September 30,
| |||||||
2021
|
2020
|
2021
|
2020
| |||||
(in thousands, except for open and closed order numbers) | ||||||||
Key operating data: | ||||||||
Opened orders | 52,867 | 37,572 | 135,442 | 101,161 | ||||
Closed orders | 35,300 | 25,358 | 99,386 | 65,026 | ||||
GAAP financial data: | ||||||||
Revenue (1)
| $ | 162,582 | $ | 121,072 | $ | 420,364 | $ | 292,304 |
Gross profit (2)
| $ | 28,302 | $ | 26,379 | $ | 81,232 | $ | 61,418 |
Net loss
| $ | (34,270) | $ | (3,622) | $ | (69,327) | $ | (26,540) |
Non-GAAP financial data (3):
| ||||||||
Retained premiums and fees | $ | 70,986 | $ | 54,048 | $ | 193,249 | $ | 136,172 |
Adjusted gross profit | $ | 30,280 | $ | 27,600 | $ | 88,937 | $ | 64,654 |
Ratio of adjusted gross profit to retained premiums and fees | 43 | % | 51 | % | 46 | % | 47 | % |
Adjusted EBITDA | $ | (20,109) | $ | (649) | $ | (35,291) | $ | (15,926) |
Three Months Ended September 30, |
Nine Months Ended September 30, | |||||||
2021
|
2020
|
2021
|
2020
| |||||
(in thousands) | (in thousands) | |||||||
Revenue
| $ | 162,582 | $ | 121,072 | $ | 420,364 | $ | 292,304 |
Minus: | ||||||||
Premiums retained by third-party agents | 91,596 | 67,024 | 227,115 | 156,132 | ||||
Retained premiums and fees
| $ | 70,986 | $ | 54,048 | $ | 193,249 | $ | 136,172 |
Minus: | ||||||||
Direct labor | 23,948 | 14,892 | 62,829 | 45,104 | ||||
Provision for claims | 6,685 | 5,242 | 16,741 | 10,065 | ||||
Depreciation and amortization | 1,978 | 1,221 | 7,705 | 3,236 | ||||
Other direct costs (1)
| 10,073 | 6,314 | 24,742 | 16,349 | ||||
Gross Profit
| $ | 28,302 | $ | 26,379 | $ | 81,232 | $ | 61,418 |
Three Months Ended September 30,
|
Nine Months Ended September 30,
| |||||||
2021
|
2020
|
2021
|
2020
| |||||
(in thousands) | (in thousands) | |||||||
Gross Profit
| $ | 28,302 | $ | 26,379 | $ | 81,232 | $ | 61,418 |
Adjusted for: | ||||||||
Depreciation and amortization | 1,978 | 1,221 | 7,705 | 3,236 | ||||
Adjusted Gross Profit
| $ | 30,280 | $ | 27,600 | $ | 88,937 | $ | 64,654 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||
2021 | 2020 | 2021 | 2020 | |||||
(in thousands) | (in thousands) | |||||||
Net loss (GAAP)
| $ | (34,270) | $ | (3,622) | $ | (69,327) | $ | (26,540) |
Adjusted for: | ||||||||
Depreciation and amortization | 1,978 | 1,221 | 7,705 | 3,236 | ||||
Interest expense | 4,531 | 1,193 | 12,341 | 4,428 | ||||
Income taxes | 170 | 204 | 506 | 620 | ||||
EBITDA
| $ | (27,591) | $ | (1,004) | $ | (48,775) | $ | (18,256) |
Adjusted for: | ||||||||
Stock-based compensation | 3,004 | 355 | 9,006 | 945 | ||||
COVID-related severance costs | - | - | - | 1,385 | ||||
Change in fair value of warrant and sponsor covered shares liabilities | 4,478 | - | 4,478 | - | ||||
Adjusted EBITDA
| $ | (20,109) | $ | (649) | $ | (35,291) | $ | (15,926) |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||
2021 | 2020 | 2021 | 2020 | |||||
(in thousands) | (in thousands) | |||||||
Adjusted Gross Profit
| $ | 30,280 | $ | 27,600 | $ | 88,937 | $ | 64,654 |
Minus: | ||||||||
Customer acquisition costs | 14,870 | 8,849 | 36,956 | 25,227 | ||||
Other indirect costs (1)
| 35,519 | 19,400 | 87,272 | 55,353 | ||||
Adjusted EBITDA | $ | (20,109) | $ | (649) | $ | (35,291) | $ | (15,926) |
Year Ended December 31, 2021
| ||||
Low | High | |||
(in thousands) | ||||
Revenue | $ | 475,000 | $ | 525,000 |
Minus: | ||||
Premiums retained by third-party agents | 225,000 | 265,000 | ||
Retained premiums and fees | $ | 250,000 | $ | 260,000 |
Minus: | ||||
Estimated adjustments (1)
| $ | 167,000 | $ | 167,000 |
Gross Profit | $ | 83,000 | $ | 93,000 |
Year Ended December 31, 2021
| ||||
Low | High | |||
(in thousands) | ||||
Gross Profit | $ | 83,000 | $ | 93,000 |
Adjusted for: | ||||
Depreciation and amortization | 12,000 | 12,000 | ||
Adjusted Gross Profit | $ | 95,000 | $ | 105,000 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||
(In thousands, except share and per share information) | 2021 | 2020 | 2021 | 2020 | ||||
Revenues: | ||||||||
Net premiums written (1)
| $ | 141,491 | $ | 103,587 | $ | 358,754 | $ | 246,738 |
Escrow, other title-related fees and other
| 20,452 | 16,742 | 59,092 | 43,298 | ||||
Investment, dividend and other income
| 639 | 743 | 2,518 | 2,268 | ||||
Total revenues
| $ | 162,582 | $ | 121,072 | $ | 420,364 | $ | 292,304 |
Expenses: | ||||||||
Premiums retained by third-party agents (2)
| $ | 91,596 | $ | 67,024 | $ | 227,115 | $ | 156,132 |
Title examination expense
| 5,289 | 4,624 | 15,643 | 11,811 | ||||
Provision for claims
| 6,685 | 5,242 | 16,741 | 10,065 | ||||
Personnel costs
| 62,410 | 36,197 | 159,829 | 104,652 | ||||
Other operating expenses
| 21,693 | 10,210 | 53,038 | 31,136 | ||||
Total operating expenses
| $ | 187,673 | $ | 123,297 | $ | 472,366 | $ | 313,796 |
Loss from operations
| $ | (25,091) | $ | (2,225) | $ | (52,002) | $ | (21,492) |
Other (expense) income: | ||||||||
Change in fair value of warrant and sponsor covered shares liabilities | (4,478) | - | (4,478) | - | ||||
Interest expense
| (4,531) | (1,193) | (12,341) | (4,428) | ||||
Loss before income taxes
| $ | (34,100) | $ | (3,418) | $ | (68,821) | $ | (25,920) |
Income tax expense
| (170) | (204) | (506) | (620) | ||||
Net loss
| (34,270) | (3,622) | (69,327) | (26,540) | ||||
Earnings per share: | ||||||||
Net loss per share attributable to shareholders - basic and diluted
| $ | (0.14) | $ | (0.06) | $ | (0.54) | $ | (0.43) |
Weighted average shares outstanding common stock - basic and diluted
| 245,003,754 | 64,060,987 | 128,105,954 | 62,255,035 |
(In thousands, except share information) |
September 30, 2021
|
December 31, 2020
| ||
Assets | ||||
Cash and cash equivalents
| $ | 411,669 | $ | 111,893 |
Restricted cash
| 2,021 | 129 | ||
Investments: | ||||
Fixed maturities | ||||
Held-to-maturity debt securities, at amortized cost | 74,872 | 65,406 | ||
Available-for-sale debt securities, at fair value (amortized cost $7,139 at December 31, 2020)
| - | 8,057 | ||
Equity securities, at fair value (cost $2,000 at December 31, 2020)
| - | 2,119 | ||
Mortgage loans
| 2,920 | 2,980 | ||
Other invested assets | 306 | - | ||
Total Investments
| $ | 78,098 | $ | 78,562 |
Receivables (net of provision for doubtful accounts of $571 at September 30, 2021 and $492 at December 31, 2020)
| 14,485 | 15,244 | ||
Prepaid expenses, deposits and other assets
| 22,161 | 7,365 | ||
Fixed assets (net of accumulated depreciation of $17,283 at September 30, 2021 and $15,065 at December 31, 2020)
| 35,243 | 21,661 | ||
Title plants
| 13,952 | 14,008 | ||
Goodwill
| 111,487 | 111,487 | ||
Trade names (net of accumulated amortization of $3,187 at December 31, 2020)
| - | 2,684 | ||
Total assets
| $ | 689,116 | $ | 363,033 |
Liabilities and stockholders' equity | ||||
Accounts payable
| $ | 6,651 | $ | 6,626 |
Accrued expenses and other liabilities
| 50,187 | 33,044 | ||
Senior secured credit agreement, net of debt issuance costs and original issue discount
| 138,684 | - | ||
Loan from a related party | - | 65,532 | ||
Liability for loss and loss adjustment expenses
| 78,671 | 69,800 | ||
Warranty liabilities | 24,440 | - | ||
Sponsor covered shares liability | 8,610 | - | ||
Total liabilities
| $ | 307,243 | $ | 175,002 |
Stockholders' equity: | ||||
Series A preferred stock, 0.0001 par value; 0 shares authorized at September 30, 2021; 0 shares and 43,737,586 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively | $ | - | $ | 1 |
Series A-1 preferred stock, 0.0001 par value; 0 shares authorized at September 30, 2021; 0 shares and 48,913,906 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively | - | 1 | ||
Series A-2 preferred stock, 0.0001 par value; 0 shares authorized at September 30, 2021; 0 shares and 14,003,187 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively | - | - | ||
Series B preferred stock, 0.0001 par value; 0 shares authorized at September 30, 2021; 0 shares and 15,838,828 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively | - | - | ||
Series C preferred stock, 0.0001 par value; 0 shares authorized at September 30, 2021; 0 shares and 60,665,631 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively | - | 1 | ||
Common stock, 0.0001 par value; 2,000,000,000 shares authorized at September 30, 2021; 321,544,052 and 62,832,307 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively | 33 | 1 | ||
Additional paid-in capital
| 530,290 | 266,464 | ||
Accumulated deficit
| (148,450) | (79,123) | ||
Accumulated other comprehensive income
| - | 686 | ||
Total stockholders' equity
| $ | 381,873 | $ | 188,031 |
Total liabilities and stockholders' equity
| $ | 689,116 | $ | 363,033 |
Nine Months Ended September 30, | ||||
(In thousands) | 2021 | 2020 | ||
Cash flow from operating activities: | ||||
Net loss | $ | (69,327) | $ | (26,540) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Interest expense - paid in kind
| 6,353 | 5,085 | ||
Depreciation and amortization
| 7,705 | 3,236 | ||
Stock-based compensation expense
| 8,447 | 945 | ||
Amortization of debt issuance costs and original issue discount
| 1,429 | - | ||
Provision for doubtful accounts
| 562 | 304 | ||
Deferred income taxes
| 377 | 535 | ||
Realized gain on debt securities
| (908) | (141) | ||
Net unrealized loss on equity securities
| 119 | 10 | ||
Gain on disposal of fixed assets and title plants
| (11) | (281) | ||
Accretion of discounts on held-to-maturity securities | 901 | 369 | ||
Change in fair value of warrant and sponsor covered shares liabilities | 4,478 | - | ||
Change in operating assets and liabilities: | ||||
Accounts receivable
| (284) | (261) | ||
Prepaid expenses, deposits and other assets
| (14,799) | (6,166) | ||
Accounts payable
| (274) | 2,658 | ||
Accrued expenses and other liabilities
| 13,813 | 472 | ||
Liability for loss and loss adjustments expenses
| 8,872 | 3,374 | ||
Net cash used in operating activities
| $ | (32,547) | $ | (16,401) |
Cash flow from investing activities: | ||||
Proceeds from sales, calls and maturities of investments: Held-to-maturity
| $ | 23,514 | $ | 15,394 |
Proceeds from sales, calls and maturities of investments: Available-for-sale | 7,817 | 18 | ||
Proceeds from sales of investments: Equity securities | 2,000 | - | ||
Proceeds from sales and principal repayments of investments: Mortgage loans
| 60 | 378 | ||
Purchases of investments: Held-to-maturity
| (33,650) | (57,624) | ||
Purchases of investments: Equity securities
| - | (1,000) | ||
Proceeds from sales of fixed assets | 306 | 246 | ||
Purchases of fixed assets
| (18,842) | (12,670) | ||
Proceeds from sale of title plants and dividends from title plants
| 482 | 1,349 | ||
Net cash used in investing activities
| $ | (18,313) | $ | (53,909) |
Nine Months Ended September 30, | ||||
(In thousands) | 2021 | 2020 | ||
Cash flow from financing activities: | ||||
Proceeds from issuance of Series C preferred stock, net of financing costs
| $ | - | $ | 70,701 |
Proceeds from issuance of senior secured credit agreement | 150,000 | - | ||
Payments on loan from a related party | (65,532) | (28,092) | ||
Debt issuance costs | (579) | - | ||
Exercise of stock warrants | 48 | - | ||
Exercise of stock options
| 1,690 | 92 | ||
Redemptions of redeemable common and preferred stock | (294,856) | - | ||
Net proceeds from Business Combination and PIPE Investment | 624,952 | - | ||
Payment of costs directly attributable to the issuance of common stock in connection with Business Combination and PIPE Investment | (63,195) | - | ||
Net cash provided by financing activities
| $ | 352,528 | $ | 42,701 |
Net change in cash and cash equivalents and restricted cash
| 301,668 | (27,609) | ||
Cash and cash equivalents and restricted cash at the beginning period | 112,022 | 141,668 | ||
Cash and cash equivalents and restricted cash at the end of period
| $ | 413,690 | $ | 114,059 |
Supplemental cash flow disclosures: | ||||
Cash paid for interest
| $ | 5,347 | $ | 1 |
Supplemental disclosure of non-cash investing activities: | ||||
Unrealized loss on available-for-sale debt securities
| $ | (179) | $ | (53) |
Supplemental disclosure of non-cash financing activities: | ||||
Issuance of penny warrants related to the senior secured credit agreement | $ | (18,519) | $ | - |
Warrant liabilities recognized in conjunction with the Business Combination | $ | 19,240 | $ | - |
Net liabilities assumed in the Business Combination | $ | 9,517 | $ | - |
Three months ended | ||||||||||||||
(In thousands) | March 31, 2020 | June 30, 2020 | September 30, 2020 | December 31, 2020 | March 31, 2021 | June 30, 2021 | September 30, 2021 | |||||||
Revenues: | ||||||||||||||
Net premiums written
| $ | 56,817 | $ | 86,334 | $ | 103,587 | $ | 98,870 | $ | 107,992 | $ | 109,271 | $ | 141,491 |
Escrow, other title-related fees and other
| 13,174 | 13,382 | 16,742 | 17,977 | 18,575 | 20,065 | 20,452 | |||||||
Investment, dividend and other income
| 818 | 707 | 743 | 663 | 1,229 | 650 | 639 | |||||||
Total revenues
| $ | 70,809 | $ | 100,423 | $ | 121,072 | $ | 117,510 | $ | 127,796 | $ | 129,986 | $ | 162,582 |
Expenses: | ||||||||||||||
Premiums retained by third-party agents
| $ | 33,102 | $ | 56,006 | $ | 67,024 | $ | 64,011 | $ | 70,338 | $ | 65,181 | $ | 91,596 |
Title examination expense
| 3,865 | 3,322 | 4,624 | 4,393 | 4,853 | 5,500 | 5,289 | |||||||
Provision for claims
| 1,783 | 3,040 | 5,242 | 5,272 | 3,249 | 6,807 | 6,685 | |||||||
Personnel costs
| 35,718 | 32,737 | 36,197 | 38,874 | 43,464 | 53,954 | 62,410 | |||||||
Other operating expenses
| 10,640 | 10,286 | 10,210 | 12,149 | 14,165 | 17,181 | 21,693 | |||||||
Total operating expenses
| $ | 85,108 | $ | 105,391 | $ | 123,297 | $ | 124,699 | $ | 136,069 | $ | 148,623 | $ | 187,673 |
Loss from operations
| $ | (14,299) | $ | (4,968) | $ | (2,225) | $ | (7,189) | $ | (8,273) | $ | (18,637) | $ | (25,091) |
Other income (expense): | ||||||||||||||
Change in fair value of warrant and sponsor earnout liabilities | - | - | - | - | - | - | (4,478) | |||||||
Interest expense
| (2,112) | (1,123) | (1,193) | (1,151) | (3,360) | (4,451) | (4,531) | |||||||
Loss before income taxes
| $ | (16,411) | $ | (6,091) | $ | (3,418) | $ | (8,340) | $ | (11,633) | $ | (23,088) | $ | (34,100) |
Income tax expense
| (175) | (241) | (204) | (223) | (125) | (211) | (170) | |||||||
Net loss
| (16,586) | (6,332) | (3,622) | (8,563) | (11,758) | (23,299) | (34,270) |
Three Months Ended | ||||||||||||||
(In thousands) | March 31, 2020 | June 30, 2020 | September 30, 2020 | December 31, 2020 | March 31, 2021 | June 30, 2021 | September 30, 2021 | |||||||
Revenue
| $ | 70,809 | $ | 100,423 | $ | 121,072 | $ | 117,510 | $ | 127,796 | $ | 129,986 | $ | 162,582 |
Minus: | ||||||||||||||
Premiums retained by third-party agents | 33,102 | 56,006 | 67,024 | 64,011 | 70,338 | 65,181 | 91,596 | |||||||
Retained premiums and fees
| $ | 37,707 | $ | 44,417 | $ | 54,048 | $ | 53,499 | $ | 57,458 | $ | 64,805 | $ | 70,986 |
Minus: | ||||||||||||||
Direct labor | 16,314 | 13,898 | 14,892 | 17,050 | 17,979 | 20,902 | 23,948 | |||||||
Provision for claims | 1,783 | 3,040 | 5,242 | 5,272 | 3,249 | 6,807 | 6,685 | |||||||
Depreciation and amortization | 1,116 | 899 | 1,221 | 2,579 | 2,707 | 3,021 | 1,978 | |||||||
Other direct costs(1)
| 5,137 | 4,898 | 6,314 | 4,186 | 7,109 | 7,561 | 10,073 | |||||||
Gross Profit
| $ | 13,357 | $ | 21,682 | $ | 26,379 | $ | 24,412 | $ | 26,414 | $ | 26,514 | $ | 28,302 |
Three Months Ended | ||||||||||||||
(in thousands) | March 31, 2020 | June 30, 2020 | September 30, 2020 | December 31, 2020 | March 31, 2021 | June 30, 2021 | September 30, 2021 | |||||||
Gross Profit
| $ | 13,357 | $ | 21,682 | $ | 26,379 | $ | 24,412 | $ | 26,414 | $ | 26,514 | $ | 28,302 |
Adjusted for: | ||||||||||||||
Depreciation and amortization | 1,116 | 899 | 1,221 | 2,579 | 2,707 | 3,021 | 1,978 | |||||||
Adjusted Gross Profit
| $ | 14,473 | $ | 22,581 | $ | 27,600 | $ | 26,991 | $ | 29,121 | $ | 29,535 | $ | 30,280 |
Three Months Ended | ||||||||||||||
(in thousands) | March 31, 2020 | June 30, 2020 | September 30, 2020 | December 31, 2020 | March 31, 2021 | June 30, 2021 | September 30, 2021 | |||||||
Net loss (GAAP)
| $ | (16,586) | $ | (6,332) | $ | (3,622) | $ | (8,563) | $ | (11,758) | $ | (23,299) | $ | (34,270) |
Adjusted for: | ||||||||||||||
Depreciation and amortization | 1,116 | 899 | 1,221 | 2,579 | 2,707 | 3,021 | 1,978 | |||||||
Interest expense | 2,112 | 1,123 | 1,193 | 1,151 | 3,360 | 4,451 | 4,531 | |||||||
Income taxes | 175 | 241 | 204 | 223 | 125 | 211 | 170 | |||||||
EBITDA
| $ | (13,183) | $ | (4,069) | $ | (1,004) | $ | (4,610) | $ | (5,566) | $ | (15,616) | $ | (27,591) |
Adjusted for: | ||||||||||||||
Stock-based compensation | 308 | 282 | 355 | 1,550 | 2,289 | 3,713 | 3,004 | |||||||
COVID-related severance costs | - | 1,385 | - | - | - | - | ||||||||
Change in fair value of warrant and sponsor covered shares liabilities | - | - | - | - | - | - | 4,478 | |||||||
Adjusted EBITDA
| $ | (12,875) | $ | (2,402) | $ | (649) | $ | (3,060) | $ | (3,277) | $ | (11,903) | $ | (20,109) |
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Disclaimer
Doma Holdings Inc. V published this content on 10 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 November 2021 21:43:11 UTC.