Exhibit 99.1

Syniverse Announces Third Quarter and Fiscal Year to

Date 2021 Financial Results

- Third Quarter Revenue of $207.9 Million, Up 30% Year-over-Year

- Fiscal Year to Date Revenue of $540 Million, Up 11% Over Prior Year

- Third Quarter Adjusted EBITDA of $60.5 Million, Up 20% Year-over-Year

- Strong 2021 Revenue and Adjusted EBITDA targets

- Conference call at 08:00 ET today

October 8, 2021 07:00 AM Eastern Daylight Standard Time

TAMPA—(BUSINESS WIRE)— Syniverse Holdings, a wholly owned subsidiary of Syniverse Corporation, the “world’s most connected company”TM and the premier global technology provider of mission-critical mobile platforms for carriers and enterprises, announced financial results for the third quarter ended August 31, 2021 and nine months year to date 2021.

“These are exciting times at Syniverse. During the quarter our secular growth from messaging and 5G gained momentum and we entered into a business combination agreement with M3 Brigade Acquisition II Corp. (NYSE: MBAC) that positions us to go public during fiscal Q1. Now is the time for us to reinvest in the growth opportunities presented by both the favorable trends in our industry and our unique technology solutions and skills in order to meet our customers’ evolving needs and drive our business,” commented Andrew Davies, CEO of Syniverse.

Davies continued, “In the third quarter we saw strong revenue trends across both of our businesses. Revenue growth accelerated in our Enterprise business, led by Wholesale A2P messaging and our retail CPaaS services, and our Carrier business saw its second consecutive quarter of revenue growth for continuing products. Going forward, we expect an even greater future contribution from 5G-driven demand by our Carrier customers. Our outlook remains positive.”

Fiscal 2021 Business Outlook

In accordance with a strong outlook for the remainder of the fiscal year, Syniverse expects to exceed its prior full year 2021 revenue target of $678M by approximately 10% and meet its $210M adjusted EBITDA target.

 

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Commercial Highlights

 

   

Recognized by Kaleido Intelligence as the leading vendor to enable 5G roaming for mobile operators;

 

   

Launched WhatsApp for businesses on the Syniverse CPaaS Concierge offering;

 

   

Joined the Adobe accelerator partner program;

 

   

Reached agreement with Tier One North American Operator to launch Syniverse’s “Evolved Mobility” 3G to VoLTE roaming solution;

 

   

Signed agreements with a worldwide OEM and an information solution and software company to resell Syniverse’s Private Networks solution suite;

 

   

Increased customers under contract for Syniverse’s Blockchain-enabled Billing and Clearing Evolution (BCE) solution.

Third Quarter Financial Highlights

 

   

Revenue grew 30% to $207.9 million during the third quarter of 2021, compared with $160.0 million during the comparable quarter in 2020. This represented our highest quarterly revenue since Q4 2015;

 

   

Enterprise revenues accounted for 49% of total revenue in the third quarter of 2021 compared to 31% of total revenue during the comparable quarter in 2020.

 

   

Direct Margin grew 6% to $114.8 million during the third quarter of 2021, compared with $108.3 million during the comparable quarter in 2020;

 

   

Adjusted EBITDA grew 20% to $60.5 million during the third quarter of 2021, compared with $50.5 million during the comparable quarter in 2020;

 

   

Free Cash Flow improved $6.6 million to ($4.4 million) during the third quarter of 2021, compared with ($11.1 million) during the comparable quarter in 2020.

Revenues

Revenues increased $47.9 million, or 30%, to $207.9 million for the three months ended August 31, 2021 from $160.0 million for the same period in 2020.

Revenues from Enterprise services increased $52.8 million, or 106%, to $102.6 million for the three months ended August 31, 2021 from $49.8 million for the same period in 2020. Revenues for Global Messaging, which is composed of A2P and Ten digit long code (10 DLC), increased by $50.8 million, or 113%, because of 10 DLC and A2P volume expansion, as well as $22.3 million of incremental message termination fees charged to Syniverse by certain U.S. carriers that are passed through to Syniverse’s customers. Revenues for CPaaS (Communications Platform as a Service) Solutions, which is composed of CPaaS and Messaging as a Platform (MaaP) services, increased by $2.0 million, or 42%, primarily due to volume expansion of CPaaS services as Syniverse relaunched its platform in fiscal 2020.

Revenues from Carrier services decreased $4.9 million, or 4%, to $105.3 million for the three months ended August 31, 2021 from $110.2 million for the same period in 2020. CDMA and Legacy revenues decreased by $7.0 million, to $3.7 million for the three months ended August 31, 2021. Excluding CDMA and Legacy revenues, the increase in Carrier revenues was $2.1 million.

 

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“CDMA and Legacy revenues” refer to revenues for end-of-life products driven by legacy protocols and technologies that are in the stage of sunset and forecasted to decrease substantially as a result.

Direct margin

Direct margin increased $6.5 million or 6% to $114.8 million for the three months ended August 31, 2021 from $108.3 million for the same period in 2020.

Enterprise direct margin increased $17.7 million, or 106%, to $34.5 million for the three months ended August 31, 2021 compared to $16.8 million for the same period in 2020. The increase was attributable to revenue growth in Global Messaging services and higher margin CPaaS Solutions.

Carrier direct margin decreased $11.2 million, or 12% for the three months ended August 31, 2021 to $80.3 million compared to $91.5 million for the same period in 2020. The decrease was attributable primarily to the decline in higher margin Global Network Services revenues.

Please see the table on page 14 for a reconciliation from loss before provision for income taxes to Direct Margin.

Adjusted EBITDA

Adjusted EBITDA increased $10.0 million or 20% to $60.5 million for the three months ended August 31, 2021 from $50.5 million for the same period in 2020. Please see the table on page 13 for a reconciliation from Syniverse’s net loss, the closest GAAP measure, to Adjusted EBITDA.

Free Cash Flow

Free Cash Flow improved by $6.6 million to ($4.4 million) for the three months ended August 31, 2021 from ($11.1) million for the same period in 2020. Net cash provided by operating activities increased $8.3 million to $9.2 million for the three months ended August 31, 2021 from $0.9 million for the same period in 2020. Capex increased by $1.6 million to $13.6 million for the three months ended August 31, 2021 from $12.0 million for the same period in 2020. Please see the table on page 13 for a reconciliation from Syniverse’s net cash provided by operating activities, the closest GAAP measure, to Free Cash Flow.

Nine Month Financial Highlights

 

   

Revenue grew 11% to $540.0 million during the nine month period of 2021, compared with $485.4 million during the comparable period in 2020;

 

   

Enterprise revenues accounted for 41% of total revenue during the nine month period of 2021 compared to 31% of total revenue during the comparable period in 2020.

 

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Direct Margin fell 5% to $317.7 million during the nine month period of 2021, compared with $333.2 million during the comparable period in 2020;

 

   

Adjusted EBITDA grew 2% to $156.1 million during the nine month period of 2021, compared with $153.2 million during the comparable period in 2020;

 

   

Free Cash Flow grew to $8.7 million during the nine month period of 2021, compared with ($14.8) million during the comparable period in 2020.

Revenues

Revenues increased $54.6 million, or 11%, to $540.0 million for the nine months ended August 31, 2021 from $485.4 million for the same period in 2020.

Revenues from Enterprise increased $72.1 million, or 48%, to $222.0 million for the nine months ended August 31, 2021 from $149.9 million for the same period in 2020. Revenues for Global Messaging, which is composed of A2P and 10 DLC, increased by $65.5 million, or 48%, primarily from 10 DLC and A2P volume expansion, as well as from incremental message termination fees charged to Syniverse by certain U.S. carriers that are passed through to Syniverse’s customers. Revenues for CPaaS Solutions, which is composed of CPaaS and MaaP services, increased by $6.6 million, or 50%, primarily due to volume expansion of CPaaS services as Syniverse relaunched its platform in fiscal 2020.

Revenues from Carrier services decreased $17.5 million, or 5%, to $318.1 million for the nine months ended August 31, 2021 from $335.6 million for the same period in 2020. CDMA and Legacy revenues totaling $20.3 million for the nine months ended August 31, 2021 contributed $15.8 million to the revenue decrease over the prior year period. Excluding CDMA and Legacy revenues, the decrease in Carrier revenues was $1.7 million.

“CDMA and Legacy revenues” refer to revenues for end-of-life products driven by legacy protocols and technologies that are in the stage of sunset and forecasted to decrease substantially as a result.

Direct margin

Direct margin decreased $15.5 million or 5% to $317.7 million for the nine months ended August 31, 2021 from $333.2 million for the same period in 2020. The decrease was attributable primarily to mix shift to messaging revenues in Carrier and Enterprise segments from Network and Outsourced Carrier Services related revenues.

Enterprise direct margin for the nine months ended August 31, 2021 increased $24.5 million, or 50% to $73.1 million compared to $48.6 million for the nine months ended August 31, 2020. The increase was attributable to revenue growth in Global Messaging services and higher margin CPaaS Solutions.

Carrier direct margin for the nine months ended August 31, 2021 decreased $40.0 million, or 14%, to $244.7 million compared to $284.6 million for the nine months ended August 31, 2020 primarily as a result of decreases in Global Network Services and Outsourced Carrier Solutions revenues.

 

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Please see the table on page 14 for a reconciliation from loss before provision for income taxes to Direct Margin.

Adjusted EBITDA

Adjusted EBITDA increased $2.9 million or 2% to $156.1 million for the nine months ended August 31, 2021 from $153.2 million for the same period in 2020. Please see the table on page 13 for a reconciliation from Syniverse’s net loss, the closest GAAP measure, to Adjusted EBITDA.

Free Cash Flow

Free Cash Flow increased $23.5 million to $8.7 million for the nine months ended August 31, 2021 from ($14.8) million for the same period in 2020. Net cash provided by operating activities increased $9.9 million or 36% to $37.5 million for the nine months ended August 31, 2021 from $27.6 million for the same period in 2020. Capex decreased by $13.6 million or 32% to $28.8 million for the nine months ended August 31, 2021 from $42.4 million for the same period in 2020. Please see the table on page 13 for a reconciliation from Syniverse’s net cash provided by operating activities, the closest GAAP measure, to Free Cash Flow.

Syniverse defines Free Cash Flow as net cash provided by operating activities minus capital expenditures.

Impact of COVID-19

The COVID-19 pandemic continues to impact roaming volumes, and we expect that it may continue to impact our business. The continued impact of COVID-19 will depend significantly on the duration and potential cyclicality of the health crisis and the related public policy actions, the length and severity of the global economic slowdown and the impacts to our customers over the longer term.

Business Combination Transaction

On August 16, 2021, Syniverse Corporation entered into a merger agreement with M3 Brigade Acquisition II Corp. (“MBAC”). The business combination is expected to close during the fourth quarter of calendar 2021. Upon closing of the transaction, the combined company intends to change its name to Syniverse Technologies Corporation and trade on the NYSE under the ticker symbol “SYNV.”

Conference call

Syniverse’s Management team will hold a conference call to discuss its fiscal Q3 2021 financial and operating results with Investors and Analysts at 08:00 ET today, Friday October 8th.

North American Toll Free +1 833 470 1428

North American Toll/International +1 404 975 4839

Access code: 256249

 

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An audio replay will be available starting at 11:00 ET Monday October 8th by dialing +1 844 385 9377 North American Toll Free or +1 678 216 4250 North American Toll/International and using access code 590362#. A recording will be available in due course on MBAC’s Investor Relations website at https://www.m3-brigade.com/

About Syniverse

Syniverse is a leading global provider of unified, mission-critical platforms enabling seamless interoperability across the mobile ecosystem. Syniverse makes global mobility work by enabling consumers and enterprises to connect, engage, and transact seamlessly and securely. Syniverse offers a premier communications platform that serves both enterprises and carriers globally and at scale. Syniverse’s proprietary software, protocols, orchestration capabilities and network assets have allowed Syniverse to address the changing needs of the mobile ecosystem for over 30 years. Syniverse continues to innovate by harnessing the potential of emerging technologies such as 5G, IoT, RCS and CPaaS for its customers.

Non-GAAP Financial Measures

In this press release, the Company includes Direct Margin, which is a measure used to evaluate the operating performance of the Company’s segments, and Adjusted EBITDA and Free Cash Flow, which are non-GAAP performance measures that the Company uses to supplement its results presented in accordance with U.S. GAAP. As required by the rules of the Securities and Exchange Commission (“SEC”), the Company has provided herein a reconciliation of the non-GAAP financial measure contained in this press release to the most directly comparable measure under GAAP. The Company’s management believes Direct Margin, Adjusted EBITDA and Free Cash Flow are useful in evaluating its operating performance and is similar to measures reported by publicly-listed U.S. competitors, and regularly used by security analysts, institutional investors and other interested parties in analyzing operating performance and prospects. By providing these non-GAAP measures, the Company’s management intends to provide investors with a meaningful, consistent comparison of the Company’s profitability for the periods presented. Direct Margin, Adjusted EBITDA and Free Cash Flow are not intended to be a substitute for any U.S. GAAP financial measure and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry.

The Company defines and calculates Direct Margin as Revenues less direct variable costs of operations (“Direct Costs”). These Direct Costs include Message Termination (MT) fees, revenue share fees, variable data processing costs, and off-network database query charges. The Company defines and calculates Adjusted EBITDA as net loss before net Other expense, Provision for (or benefit from) income taxes, Depreciation and amortization expense, Restructuring expense, Non-cash stock-based compensation, Other expenses, Consulting fee and related expense. The Company defines and calculates Free Cash Flow as Net Cash provided by (or used in) operating activities less Cash Capital expenditures.

Forward-Looking Statements

This press release may contain “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. The expectations, estimates and projections of the businesses of MBAC or Syniverse may differ from their actual

 

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results and consequently you should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “would,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, expectations with respect to future performance of MBAC and Syniverse and anticipated financial impacts of the proposed transaction, the satisfaction of the closing conditions to the proposed transaction and the timing of the completion of the proposed transaction.

These forward-looking statements are not guarantees of future performance, conditions, or results, and involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Most of these factors are outside of the control of MBAC and Syniverse and are difficult to predict. Factors that may cause such differences include, but are not limited to: (1) the inability to complete the transactions contemplated by the agreement and plan of merger with respect to the proposed transaction (the “Merger Agreement”), including due to failure to obtain approval of the stockholders of MBAC or other conditions to closing in the Merger Agreement; (2) the outcome of any legal proceedings that may be instituted against the parties following announcement of the Merger Agreement and the proposed transactions contemplated thereby; (3) the ability to recognize the anticipated benefits of the proposed business combination, which may be affected by, among other things, competition, the ability of the post-combination company to grow and manage growth profitably, maintain relationships with customers and suppliers and retain its management and key employees; (4) the occurrence of any event, change or other circumstances that could give rise to the termination of the Merger Agreement and the proposed transactions contemplated thereby; (5) risks related to the uncertainty of the projected financial information with respect to Syniverse; (6) the inability to obtain or maintain the listing of the post-acquisition company’s Class A Stock and public warrants on the NYSE following the proposed business combination; (7) risks related to the post-combination company’s ability to raise financing in the future; (8) the post-combination company’s success in retaining or recruiting, or changes required in, our officers, key employees or directors following the proposed business combination; (9) our directors and officers potentially having conflicts of interest with our business or in approving the proposed business combination; (10) intense competition and competitive pressures from other companies in the industry in which the post-combination company will operate; (11) the business, operations and financial performance of Syniverse, including market conditions and global and economic factors beyond Syniverse’s control; (12) the effect of legal, tax and regulatory changes; (13) the receipt by MBAC or Syniverse of an unsolicited offer from another party for an alternative business transaction that could interfere with the proposed business combination; (14) the risk that the proposed business combination disrupts current plans and operations of MBAC or Syniverse as a result of the announcement and consummation of the transactions described herein; (15) costs related to the proposed business combination; (16) changes in applicable laws or regulations; (17) the possibility that MBAC or Syniverse may be adversely affected by other economic, business, and/or competitive factors; (18) the amount of redemption requests made by MBAC’s public stockholders; (19) the impact of the continuing COVID-19 pandemic on MBAC, Syniverse and Syniverse’s projected results of operations, financial performance or other financial metrics or on any of the foregoing risks; and (20) other risks and uncertainties disclosed in MBAC’s preliminary proxy statement, including those under “Risk Factors,” and other documents filed or to be filed with the SEC by MBAC.

MBAC and Syniverse caution that the foregoing list of factors is not exclusive. You should not place undue reliance upon any forward-looking statements, which speak only as of the date made.

 

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Syniverse and MBAC do not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in their expectations or any change in events, conditions or circumstances on which any such statement is based.

Information About the Proposed Business Merger and Where to Find It

In connection with the proposed transaction, MBAC has filed a preliminary proxy statement and plans to file a definitive proxy statement with the SEC. MBAC’S STOCKHOLDERS AND OTHER INTERESTED PERSONS ARE ADVISED TO READ, WHEN AVAILABLE, THE PRELIMINARY PROXY STATEMENT, THE AMENDMENTS THERETO, AND THE DEFINITIVE PROXY STATEMENT AND DOCUMENTS INCORPORATED BY REFERENCE THEREIN FILED IN CONNECTION WITH THE PROPOSED TRANSACTION, AS THESE MATERIALS WILL CONTAIN IMPORTANT INFORMATION ABOUT MBAC, SYNIVERSE AND THE PROPOSED TRANSACTION. When available, the definitive proxy statement will be mailed to the stockholders of MBAC as of a record date to be established for voting on the proposed transaction. Stockholders will also be able to obtain copies of the preliminary proxy statement, the definitive proxy statement and other documents filed with the SEC that will be incorporated by reference therein, without charge, once available, at the SEC’s website at http://www.sec.gov, or by directing a request to: M3-Brigade Acquisition II Corp., 1700 Broadway – 19th Floor, New York, New York 10019.

Participants in the Solicitation

MBAC and its directors and executive officers may be deemed participants in the solicitation of proxies of MBAC’s stockholders with respect to the proposed transaction. A list of those directors and executive officers and a description of their interests in MBAC will be filed in the proxy statement for the proposed transaction and available at www.sec.gov. Additional information regarding the interests of such participants will be contained in the proxy statement for the proposed transaction when available.

Syniverse and its directors and executive officers may also be deemed to be participants in the solicitation of proxies from the stockholders of MBAC in connection with the proposed transaction. A list of the names of such directors and executive officers and information regarding their interests in the proposed transaction will be included in the proxy statement for the proposed business combination.

No Offer or Solicitation

This press release shall not constitute a solicitation of a proxy, consent, or authorization with respect to any securities or in respect of the proposed transaction. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any states or jurisdictions in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of section 10 of the Securities Act of 1933, as amended.

 

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SYNIVERSE HOLDINGS, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(IN THOUSANDS)

 

     Three Months Ended August 31,     Nine Months Ended August 31,  
     2021     2020     2021     2020  

Revenues

   $ 207,946   $ 160,041   $ 540,049   $ 485,437

Costs and expenses:

        

Cost of operations (excluding depreciation and amortization shown separately below)

     120,628     81,545     305,168     243,621

Sales and marketing

     12,837     14,860     37,995     46,827

General and administrative

     19,243     25,391     66,072     70,622

Depreciation and amortization

     18,130     28,549     60,620     83,752

Restructuring expense

     1,562     15,887     3,920     18,571
  

 

 

   

 

 

   

 

 

   

 

 

 
     172,400     166,232     473,775     463,393
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income (loss)

     35,546     (6,191     66,274     22,044

Other (expense) income, net:

        

Interest expense

     (40,759     (42,658     (121,694     (128,654

Equity income (loss) in investees

     867     (619     (325     (1,003

Other, net

     3,008     (5,472     (661     (3,854
  

 

 

   

 

 

   

 

 

   

 

 

 
     (36,884     (48,749     (122,680     (133,511
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss before provision for income taxes

     (1,338     (54,940     (56,406     (111,467

Provision for income taxes

     2,452     960     5,033     7,375
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss

     (3,790     (55,900     (61,439     (118,842

Net income attributable to noncontrolling interest

     1,692     204     2,242     149
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to Syniverse Holdings, Inc.

   $ (5,482   $ (56,104   $ (63,681   $ (118,991
  

 

 

   

 

 

   

 

 

   

 

 

 

 

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SYNIVERSE HOLDINGS, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE OPERATIONS

(IN THOUSANDS)

 

     Three Months Ended August 31,     Nine Months Ended August 31,  
     2021     2020     2021     2020  

Net loss

   $ (3,790   $ (55,900   $ (61,439   $ (118,842

Other comprehensive income (loss), net of tax (1):

        

Foreign currency translation adjustments

     (14,046     27,751     (4,098     25,618

Changes related to cash flow derivative hedges

     5,358     6,502     15,668     (1,902

Changes in unrecognized pension cost

     32     27     95     (4,874
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Other comprehensive (loss) income

     (8,656     34,280     11,665     18,842
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Comprehensive loss

     (12,446     (21,620     (49,774     (100,000

Less: comprehensive income attributable to noncontrolling interest

     1,632     341     2,328     91
  

 

 

   

 

 

   

 

 

   

 

 

 

Comprehensive loss attributable to Syniverse Holdings, Inc.

   $ (14,078   $ (21,961   $ (52,102   $ (100,091
  

 

 

   

 

 

   

 

 

   

 

 

 

 

(1) 

There was no income tax provision or benefit on the components of other comprehensive income (loss) for the three and nine months ended August 31, 2021 and 2020 as a result of income tax valuation allowances.

 

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SYNIVERSE HOLDINGS, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

 

     Nine Months Ended August 31,  
     2021     2020  
Cash flows from operating activities     

Net loss

   $ (61,439   $ (118,842

Adjustments to reconcile net loss to net cash provided by operating activities:

    

Depreciation and amortization

     60,620     83,752

Amortization of original issue discount and deferred financing costs

     6,686     6,283

Allowance for credit memos and uncollectible accounts

     1,003     3,228

Deferred income tax expense

     4,022     2,486

Stock-based compensation

     6,979     12,536

Unrealized foreign currency transaction (gain) loss

     (332     3,938

Other, net

     11,341     6,476

Changes in operating assets and liabilities:

    

Accounts receivable

     (11,033     20,419

Income tax receivable or payable

     (1,395     (749

Prepaid and other current assets

     (21,693     (2,673

Accounts payable

     23,502     4,710

Accrued liabilities and deferred revenues

     21,260     8,260

Other assets and other long-term liabilities

     (1,988     (2,189

Net cash provided by operating activities

     37,533     27,635
  

 

 

   

 

 

 
Cash flows from investing activities     
Capital expenditures      (28,815     (42,401
  

 

 

   

 

 

 

Net cash used in investing activities

     (28,815     (42,401
  

 

 

   

 

 

 
Cash flows from financing activities     

Proceeds from Revolving Credit Facility

     —         85,600

Principal payments on Revolving Credit Facility

     —         (25,000

Principal payments on long-term debt

     (12,765     (12,765

Payments on capital lease obligations and software financing arrangements

     (5,228     (7,036

Purchases of treasury shares for Syniverse Corporation

     (1,015     (2,627

Other

     —         (2,483
  

 

 

   

 

 

 

Net cash (used in) provided by financing activities

     (19,008     35,689
  

 

 

   

 

 

 

Effect of exchange rate changes on cash

     142     (725

Net (decrease) increase in cash, cash equivalents and restricted cash

     (10,148     20,198

Cash, cash equivalents and restricted cash at beginning of period

     89,500     48,647

Cash, cash equivalents and restricted cash at end of period

   $ 79,352   $ 68,845
  

 

 

   

 

 

 
Supplemental Disclosure of Cash Flow Information     

Non-Cash Financing and Investing Transactions:

    

Assets acquired under capital leases and software financing arrangements

   $ 576   $ 18,993

Cash paid in the period for:

    

Interest

   $ 112,096   $ 109,518

Income taxes

   $ 2,428   $ 5,649

 

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SYNIVERSE HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS)

 

     August 31, 2021     November 30, 2020  
     (Unaudited)        
ASSETS     

Current assets:

    

Cash and cash equivalents

   $ 77,800   $ 88,493

Accounts receivable, net of allowances of $4,989 and $10,584, respectively

     134,004     124,219

Income taxes receivable

     5,754     6,376

Prepaid and other current assets

     34,460     21,039
  

 

 

   

 

 

 

Total current assets

     252,018     240,127

Property and equipment, net

     37,738     47,459

Capitalized software, net

     73,299     83,512

Goodwill

     2,306,272     2,310,145

Identifiable intangibles, net

     112,230     125,004

Deferred tax assets

     2,096     2,108

Investment in unconsolidated subsidiaries

     35,013     35,338

Other assets

     7,885     10,701
  

 

 

   

 

 

 

Total assets

   $ 2,826,551   $ 2,854,394
  

 

 

   

 

 

 
LIABILITIES AND STOCKHOLDER EQUITY     

Current liabilities:

    

Accounts payable

   $ 67,972   $ 44,835

Accrued liabilities

     141,423     119,545

Income taxes payable

     1,409     3,435

Current portion of long-term debt, net of original issue discount and deferred financing costs

     16,888     16,830

Deferred revenues

     4,774     5,739
  

 

 

   

 

 

 

Total current liabilities

     232,466     190,384

Long-term debt, net of original issue discount and deferred financing costs

     1,919,325     1,925,463

Deferred tax liabilities

     83,500     81,379

Other long-term liabilities

     56,216     78,314
  

 

 

   

 

 

 

Total liabilities

     2,291,507     2,275,540
  

 

 

   

 

 

 

Commitments and contingencies (Note 10)

    

Stockholder equity:

    

Common stock $0.01 par value; one thousand shares authorized, issued and outstanding as of August 31, 2021 and November 30, 2020

     —         —    

Additional paid-in capital

     1,309,874     1,303,910

Accumulated deficit

     (683,824     (620,143

Accumulated other comprehensive loss

     (102,267     (113,846
  

 

 

   

 

 

 

Total Syniverse Holdings, Inc. stockholder equity

     523,783     569,921

Noncontrolling interest

     11,261     8,933
  

 

 

   

 

 

 

Total stockholder equity

     535,044     578,854
  

 

 

   

 

 

 

Total liabilities and stockholder equity

   $ 2,826,551   $ 2,854,394
  

 

 

   

 

 

 

 

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     Three Months Ended August 31,      Nine Months Ended August 31,  
(in thousands)    2021      2020      2021      2020  

Reconciliation to Adjusted EBITDA

           

Net loss

   $ (3,790    $ (55,900    $ (61,439    $ (118,842

Other expense, net

     36,884      48,749      122,680      133,511

Provision for income taxes

     2,452      960      5,033      7,375

Depreciation and amortization

     18,130      28,549      60,620      83,752

Restructuring expense (a)

     1,562      15,887      3,920      18,571

Non-cash stock-based compensation (b)

     2,583      7,186      6,979      12,536

Other expenses (c)

     1,965      4,322      16,090      13,981

Consulting fee and related expenses (d)

     750      780      2,264      2,358
  

 

 

    

 

 

    

 

 

    

 

 

 

Adjusted EBITDA

   $ 60,536    $ 50,533    $ 156,147    $ 153,242
  

 

 

    

 

 

    

 

 

    

 

 

 

 

(a)

Reflects restructuring expense which represents costs related to certain exit activities such as severance costs, facility exit costs and contract termination costs associated with a restructuring plan.

(b)

Reflects non-cash expenses related to equity compensation awards.

(c)

Reflects items associated with certain advisory and professional services related to strategic initiatives and otherwise, employee costs and data center migration costs.

(d)

Reflects management fees paid to Carlyle and related expenses pursuant to a consulting agreement with Carlyle.

 

     Nine Months Ended August 31,  
(in thousands)    2021      2020  

Reconciliation to Free Cash Flow

     

Net cash provided by operating activities

   $ 37,533    $ 27,635

Capital expenditures

     (28,815      (42,401
  

 

 

    

 

 

 

Free Cash Flow

   $ 8,718    $ (14,766
  

 

 

    

 

 

 

For the three and nine months ended August 31, 2021 and 2020, Syniverse has reported revenues and direct margin information on a segment basis.

The following table presents revenues by segment:

 

     Three Months Ended August 31,      Nine Months Ended August 31,  
(in thousands)    2021      2020      2021      2020  

Carrier

   $ 105,306    $ 110,199    $ 318,059    $ 335,577

Enterprise

     102,640      49,842      221,990      149,860
  

 

 

    

 

 

    

 

 

    

 

 

 

Revenues

   $ 207,946    $ 160,041    $ 540,049    $ 485,437
  

 

 

    

 

 

    

 

 

    

 

 

 

 

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The following table presents direct margin by segment:

 

     Three Months Ended August 31,      Nine Months Ended August 31,  
(in thousands)    2021      2020      2021      2020  

Carrier direct margin

   $ 80,350    $ 91,510    $ 244,650    $ 284,640

Enterprise direct margin

     34,468      16,765      73,083      48,600
  

 

 

    

 

 

    

 

 

    

 

 

 

Total direct margin

   $ 114,818    $ 108,275    $ 317,733    $ 333,240
  

 

 

    

 

 

    

 

 

    

 

 

 

The following table provides a reconciliation of total direct margin to loss before provision for income taxes:

 

     Three Months Ended August 31,      Nine Months Ended August 31,  
(in thousands)    2021      2020      2021      2020  

Revenues

   $ 207,946    $ 160,041    $ 540,049    $ 485,437

Variable costs of operations

     93,128      51,766      222,316      152,197
  

 

 

    

 

 

    

 

 

    

 

 

 

Direct margin

     114,818      108,275      317,733      333,240

Fixed costs of operations

     27,500      29,779      82,852      91,424

Sales and marketing

     12,837      14,860      37,995      46,827

General and administrative

     19,243      25,391      66,072      70,622

Depreciation and amortization

     18,130      28,549      60,620      83,752

Restructuring expense

     1,562      15,887      3,920      18,571
  

 

 

    

 

 

    

 

 

    

 

 

 

Operating income

     35,546      (6,191      66,274      22,044

Other expense, net

     (36,884      (48,749      (122,680      (133,511
  

 

 

    

 

 

    

 

 

    

 

 

 

Loss before provision for income taxes

   $ (1,338    $ (54,940    $ (56,406    $ (111,467
  

 

 

    

 

 

    

 

 

    

 

 

 

Contacts

 

Media and Press:    Investor Relations:
Kevin Petschow    Stanley Martinez, CFA, IRC
Syniverse    Syniverse
kevin.petschow@syniverse.com    ir@syniverse.com
+1.813.637.5084    +1.813.614.1070
Brooke Gordon / Kelsey Markovich    Jason Terry
Sard Verbinnen & Co.    Syniverse
syniverse-svc@sardverb.com    ir@syniverse.com
+1.212.687.8080    +1.310.951.3187

 

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