BOSTON, Feb. 13, 2020 (GLOBE NEWSWIRE) -- LogMeIn, Inc. (NASDAQ: LOGM), a leading provider of cloud-based connectivity, today announced its results for the fourth quarter and fiscal year ended December 31, 2019.

Fourth quarter 2019 highlights include:

  • GAAP revenue was $322.7 million and non-GAAP revenue was $322.9 million
  • GAAP net loss was $4.1 million or ($0.08) per share and non-GAAP net income was $69.8 million or $1.43 per diluted share
  • EBITDA was $79.4 million or 24.6% of GAAP revenue and Adjusted EBITDA was $111.1 million or 34.4% of non-GAAP revenue
  • Cash flow from operations was $74.5 million or 23.1% of non-GAAP revenue, and adjusted free cash flow was $62.6 million or 19.4% of non-GAAP revenue
  • Total GAAP deferred revenue was $408.2 million
  • The Company closed the quarter with cash and cash equivalents of $128.0 million and $200.0 million of borrowings under its existing credit agreement

Fiscal year 2019 highlights include:

  • GAAP revenue was $1.260 billion and non-GAAP revenue was $1.262 billion
  • GAAP net loss was $14.6 million or ($0.29) per share and non-GAAP net income was $256.9 million or $5.15 per diluted share
  • EBITDA was $302.9 million or 24.0% of GAAP revenue and Adjusted EBITDA was $412.7 million or 32.7% of non-GAAP revenue
  • Cash flow from operations was $360.8 million or 28.6% of non-GAAP revenue and adjusted free cash flow was $308.9 million or 24.5% of non-GAAP revenue
  • $273.1 million returned to stockholders with $208.5 million of share repurchases and $64.6 million of dividends

Conference Call and Financial Outlook       
LogMeIn will not be holding a conference call or be providing a financial outlook due to the Company’s previously announced proposed transaction with affiliates of Francisco Partners and Evergreen Coast Capital Corp., the private equity affiliate of Elliott Management Corporation.  Additional information about the proposed transaction can be found in the definitive proxy statement which was filed with the Securities and Exchange Commission (the “SEC”) on February 7, 2020.    

Where to Find Additional Business and Financial Information
Additional information regarding the Company’s fourth quarter and fiscal year 2019 results, financial condition and operations, including details regarding a global restructuring plan initiated by the Company in the first quarter of 2020 to help fund its strategic initiatives, can be found in the Form 8-K filed in connection with this press release as well as the Company’s Annual Report on Form 10-K to be filed on February 14, 2020, both of which will be available on the SEC’s website, http://www.sec.gov, and the Company’s investor relations website.

Non-GAAP Financial Measures
This press release contains non-GAAP financial measures including non-GAAP revenue, EBITDA, EBITDA margin, adjusted EBITDA, adjusted EBITDA margin, non-GAAP operating income, non-GAAP income before provision for income taxes, non-GAAP provision for income taxes, non-GAAP net income, non-GAAP net income per diluted share, adjusted cash flow from operations, and adjusted free cash flow.

  • Non-GAAP revenue excludes the impact of the fair value acquisition accounting adjustment on acquired deferred revenue. 
  • EBITDA is GAAP net income (loss) excluding interest, income taxes, other (expense) income, net, and depreciation and amortization expense. 
  • EBITDA margin is calculated by dividing EBITDA by revenue. 
  • Adjusted EBITDA is EBITDA excluding the impact of the fair value acquisition accounting adjustment on acquired deferred revenue, acquisition-related costs, merger-related costs, gain on disposition of non-core assets, stock-based compensation expense, restructuring charges, and litigation-related expense. 
  • Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by non-GAAP revenue, or GAAP revenue if not different. 
  • Non-GAAP operating income excludes the impact of the fair value acquisition accounting adjustment on acquired deferred revenue, acquisition related costs and amortization, merger-related costs, gain on disposition of non-core assets, stock-based compensation expense, restructuring charges, and litigation-related expense and includes amortization expense for acquired company internally capitalized software development costs that were adjusted in acquisition accounting.
  • Non-GAAP provision for income taxes excludes the tax impact of the fair value acquisition accounting adjustment on acquired deferred revenue, acquisition-related costs and amortization, merger-related costs, gain on disposition of non-core assets, stock-based compensation expense, restructuring charges, litigation-related expense, discrete integration related tax impacts, and the tax impact related to the enactment of the U.S. Tax Cuts and Jobs Act of 2017, and includes the tax impact of amortization expense for acquired company internally capitalized software development costs that were adjusted in acquisition accounting.
  • Non-GAAP net income and non-GAAP net income per diluted share reflects the adjustments noted in non-GAAP operating income and non-GAAP provision for income taxes above.
  • Adjusted cash flow from operations excludes acquisition retention-based bonus, litigation, restructuring, acquisition-related payments and transaction and transition-related tax payments.
  • Adjusted free cash flow is adjusted cash flow from operations excluding purchases of property and equipment and intangible asset additions.

The exclusion of certain expenses in the calculation of non-GAAP financial measures should not be construed as an inference that these costs are unusual or infrequent. We anticipate excluding these expenses in the future presentation of our non-GAAP financial measures. The Company believes that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to the Company's financial condition and results of operations. The Company's management uses these non-GAAP measures to compare the Company's performance to that of prior periods and uses these measures in financial reports prepared for management and the Company's board of directors. The Company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company's financial measures with other software-as-a-service companies, many of which present similar non-GAAP financial measures to investors. The Company does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant elements that are required by GAAP to be recorded in the Company's financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management in determining these non-GAAP financial measures. In order to compensate for these limitations, management of the Company presents its non-GAAP financial measures in connection with its GAAP results. The Company urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing quarterly financial results, and not to rely on any single financial measure to evaluate the Company's business. Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP measures used in this press release are included in this release.

About LogMeIn, Inc.
LogMeIn, Inc. (NASDAQ: LOGM) simplifies how people connect with each other and the world around them to drive meaningful interactions, deepen relationships, and create better outcomes for individuals and businesses. One of the world’s top 10 public SaaS companies, and a market leader in unified communications and collaboration, identity and access management, and customer engagement and support solutions, LogMeIn has millions of customers spanning virtually every country across the globe. LogMeIn is headquartered in Boston, Massachusetts with additional locations in North America, South America, Europe, Asia and Australia.

LogMeIn is a registered trademark of LogMeIn, Inc. in the US and other countries around the world.

Contact Information:
Investors
Rob Bradley   
LogMeIn, Inc.
781-897-1301
rbradley@LogMeIn.com

Press
Craig VerColen
LogMeIn, Inc.
781-897-0696
Press@LogMeIn.com

  
LogMeIn, Inc. 
Condensed Consolidated Balance Sheets (unaudited) 
(In thousands) 
      
  December 31, December 31, 
   2018   2019  
      
ASSETS 
Current assets:     
  Cash and cash equivalents $148,652  $128,005  
  Accounts receivable, net  95,354   107,595  
  Prepaid expenses and other current assets  83,887   89,351  
  Total current assets  327,893   324,951  
Property and equipment, net  98,238   99,157  
Operating lease assets  -   99,026  
Restricted cash  1,840   1,883  
Intangibles, net  1,059,988   840,427  
Goodwill  2,400,390   2,414,287  
Other assets  41,545   68,272  
Deferred tax assets  6,059   7,994  
  Total assets $3,935,953  $3,855,997  
      
LIABILITIES AND EQUITY 
Current liabilities:     
  Accounts payable $35,447  $52,104  
  Current operating lease liabilities  -   18,470  
  Accrued liabilities  119,379   161,996  
  Deferred revenue, current portion  369,780   390,087  
  Total current liabilities  524,606   622,657  
Long-term debt  200,000   200,000  
Deferred revenue, net of current portion  9,518   18,076  
Deferred tax liabilities  201,212   170,482  
Non-current operating lease liabilities  -   88,674  
Other long-term liabilities  25,929   15,400  
  Total liabilities  961,265   1,115,289  
Equity:     
  Common stock  567   573  
  Additional paid-in capital  3,316,603   3,369,893  
  Retained earnings  84,043   4,931  
  Accumulated other comprehensive income (loss)  2,133   684  
  Treasury stock  (428,658)  (635,373) 
  Total equity  2,974,688   2,740,708  
Total liabilities and equity $3,935,953  $3,855,997  
      


LogMeIn, Inc.  
Condensed Consolidated Statements of Operations (unaudited)  
(In thousands, except per share data)  
          
  Three Months Ended December 31, Twelve Months Ended December 31, 
   2018   2019   2018   2019  
          
Revenue $310,198  $322,680  $1,203,992  $1,260,385  
Cost of revenue  72,853   83,980   281,481   323,665  
  Gross profit  237,345   238,700   922,511   936,720  
Operating expenses:         
  Research and development  40,153   39,951   169,409   160,499  
  Sales and marketing  100,399   115,015   382,997   461,078  
  General and administrative  33,462   41,401   145,453   144,780  
  Restructuring charge  -   (134)  -   14,468  
  Gain on disposition of assets  -   -   (33,910)  -  
  Amortization of acquired intangibles  43,841   39,312   172,539   157,569  
  Total operating expenses  217,855   235,545   836,488   938,394  
Income (loss) from operations  19,490   3,155   86,023   (1,674) 
  Interest income  337   276   1,671   1,651  
  Interest expense  (2,128)  (1,930)  (6,342)  (8,247) 
  Other income (expense), net  (154)  (401)  (556)  (588) 
Income (loss) before income taxes  17,545   1,100   80,796   (8,858) 
(Provision for) benefit from income taxes  7,843   (5,202)  (6,425)  (5,697) 
Net income (loss) $25,388  $(4,102) $74,371  $(14,555) 
          
Net income (loss) per share:         
  Basic $0.50  $(0.08) $1.44  $(0.29) 
  Diluted $0.49  $(0.08) $1.42  $(0.29) 
Weighted average shares outstanding:         
  Basic  50,995   48,696   51,814   49,586  
  Diluted  51,353   48,696   52,496   49,586  
          


LogMeIn, Inc.   
Calculation of Non-GAAP Revenue (unaudited)
  
            
   Three Months Ended December 31, Twelve Months Ended December 31,  
    2018   2019   2018   2019   
    (in thousands)  (in thousands)  
GAAP Revenue $310,198  $322,680  $1,203,992  $1,260,385   
 Add Back:          
 Effect of acquisition accounting on fair value of acquired deferred revenue  533   253   3,718   1,231   
Non-GAAP Revenue $310,731  $322,933  $1,207,710  $1,261,616   
            
Calculation of Non-GAAP Operating Income, Non-GAAP Net Income and Non-GAAP Net Income per Diluted Share (unaudited)
  
            
   Three Months Ended December 31, Twelve Months Ended December 31,  
    2018   2019   2018   2019   
    (In thousands, except per share data)(In thousands, except per share data) 
GAAP Net income (loss) from operations $19,490  $3,155  $86,023  $(1,674)  
 Add Back:          
 Effect of acquisition accounting on fair value of acquired deferred revenue  533   253   3,718   1,231   
 Stock-based compensation expense  16,914   17,361   65,734   68,206   
 Acquisition related costs  3,806   2,665   22,880   12,926   
 Merger related costs  -   10,919   -   10,919   
 Restructuring charge  -   (134)  -   14,468   
 Litigation related expenses  107   623   584   2,029   
 Amortization of acquired intangibles  62,158   60,139   245,244   241,263   
 Gain on disposition of assets  -   -   (33,910)  -   
 Effect of acquisition accounting on internally capitalized software development costs  (749)  -   (8,385)  -   
Non-GAAP Operating income  102,259   94,981   381,888   349,368   
 Interest and other expense, net  (1,945)  (2,055)  (5,227)  (7,184)  
Non-GAAP Income before income taxes  100,314   92,926   376,661   342,184   
 Non-GAAP Provision for income taxes  (24,828)  (23,148)  (93,637)  (85,238)  
Non-GAAP Net income $75,486  $69,778  $283,024  $256,946   
            
Non-GAAP net income per diluted share $1.47  $1.43  $5.39  $5.15   
Diluted weighted average shares outstanding used in computing per share amounts  51,353   48,938   52,496   49,900   
            
Calculation of EBITDA and Adjusted EBITDA (unaudited)   
            
   Three Months Ended December 31, Twelve Months Ended December 31,  
    2018   2019   2018   2019   
    (in thousands)  (in thousands)  
GAAP Net income (loss) $25,388  $(4,102) $74,371  $(14,555)  
 Add Back:          
 Interest and other expense, net  1,945   2,055   5,227   7,184   
 Income tax provision (benefit)  (7,843)  5,202   6,425   5,697   
 Amortization of acquired intangibles  62,158   60,139   245,244   241,263   
 Depreciation and amortization expense  15,731   16,102   55,827   63,333   
EBITDA  97,379   79,396   387,094   302,922   
 Add Back:          
 Effect of acquisition accounting on fair value of acquired deferred revenue  533   253   3,718   1,231   
 Stock-based compensation expense  16,914   17,361   65,734   68,206   
 Gain on disposition of assets  -   -   (33,910)  -   
 Acquisition related costs  3,806   2,665   22,880   12,926   
 Merger related costs  -   10,919   -   10,919   
 Restructuring charge  -   (134)  -   14,468   
 Litigation related expenses  107   623   584   2,029   
Adjusted EBITDA $118,739  $111,083  $446,100  $412,701   
 EBITDA Margin  31.4%  24.6%  32.2%  24.0%  
 Adjusted EBITDA Margin  38.2%  34.4%  36.9%  32.7%  
            
Calculation of Adjusted Cash Flows from Operations and Adjusted Free Cash Flow (unaudited)
  
            
   Three Months Ended December 31, Twelve Months Ended December 31,  
    2018   2019   2018   2019   
    (in thousands)  (in thousands)  
GAAP Cash flows from operations $73,175  $74,481  $404,039  $360,849   
 Add Back:          
 Litigation related payments  305   676   1,467   1,498   
 Acquisition retention-based bonus  577   1,198   3,720   7,779   
 Restructuring payments  -   655   -   10,153   
 Tax payment for gain on Xively disposition and integration-related IP realignment  10,862   -   15,098   -   
 Transaction related payments (acquisitions and dispositions)  1,890   1,542   18,684   3,859   
Adjusted cash flows from operations   86,809   78,552   443,008   384,138   
 Purchases of property and equipment  (9,375)  (5,625)  (30,965)  (35,438)  
 Intangible asset additions  (8,081)  (10,368)  (34,219)  (39,789)  
Adjusted Free Cash Flow $69,353  $62,559  $377,824  $308,911   
 GAAP Cash flows from operations as a % of Non-GAAP Revenue  23.5%  23.1%  33.5%  28.6%  
 Adjusted Cash flows from operations as a % of Non-GAAP Revenue  27.9%  24.3%  36.7%  30.4%  
 Adjusted Free Cash Flow as a % of Non-GAAP Revenue  22.3%  19.4%  31.3%  24.5%  
            
Stock-Based Compensation Expense (unaudited)
  
            
   Three Months Ended December 31, Twelve Months Ended December 31,  
    2018   2019   2018   2019   
    (in thousands)  (in thousands)  
Cost of revenue $1,242  $1,272  $4,997  $4,862   
Research and development  4,637   4,749   18,869   17,574   
Sales and marketing  4,207   4,718   15,995   17,930   
General and administrative  6,828   6,622   25,873   27,840   
Total stock based-compensation $16,914  $17,361  $65,734  $68,206   
            


 LogMeIn, Inc. 
Condensed Consolidated Statements of Cash Flows (unaudited) 
 (In thousands) 
           
    Three Months Ended December 31, Twelve Months Ended December 31,
     2018   2019   2018   2019 
Cash flows from operating activities        
Net income (loss) $25,388  $(4,102) $74,371  $(14,555)
Adjustments to reconcile net income (loss) to net cash        
  provided by operating activities:        
  Stock-based compensation  16,914   17,361   65,734   68,206 
  Depreciation and amortization  77,889   76,241   301,071   304,596 
  Gain on disposition of assets, excluding transaction costs  -   -   (36,281)  - 
  Change in fair value of contingent consideration liability  -   268   -   849 
  Restructuring-related property and equipment charges  -   -   -   3,164 
  Benefit from deferred income taxes  (23,395)  (1,597)  (57,456)  (35,698)
  Other, net  490   502   1,771   1,776 
  Changes in assets and liabilities, excluding effect of acquisitions and dispositions:        
  Accounts receivable  (8,551)  (26,129)  7,751   (13,521)
  Prepaid expenses and other current assets  (22,145)  (7,583)  (13,671)  (12,998)
  Other assets  (3,765)  (6,760)  (16,596)  (27,147)
  Accounts payable  (2,471)  (3,987)  11,104   17,464 
  Accrued liabilities  5,697   13,738   26,811   37,884 
  Deferred revenue  7,385   11,383   35,416   29,047 
  Other long-term liabilities  (261)  5,146   4,014   1,782 
  Net cash provided by operating activities  73,175   74,481   404,039   360,849 
Cash flows from investing activities        
Purchases of property and equipment  (9,375)  (5,625)  (30,965)  (35,438)
Intangible asset additions  (8,081)  (10,368)  (34,219)  (39,789)
Acquisition of businesses, net of cash acquired  -   -   (342,072)  (22,463)
Proceeds from disposition of assets  -   -   42,394   7,500 
  Net cash provided by (used in) investing activities  (17,456)  (15,993)  (364,862)  (90,190)
Cash flows from financing activities        
Borrowings (repayments) under credit facility  -   -   200,000   - 
Proceeds from issuance of common stock upon option exercises and employee stock purchase plan    -   5,071   3,831   5,204 
Payments of withholding taxes in connection with restricted stock unit vesting  (1,126)  (1,646)  (30,617)  (20,114)
Payment of contingent consideration  -   -   -   (1,857)
Dividends paid on common stock  (15,302)  (15,821)  (62,202)  (64,557)
Purchase of treasury stock  (56,914)  (39,316)  (247,144)  (208,504)
  Net cash provided by (used in) financing activities  (73,342)  (51,712)  (136,132)  (289,828)
Effect of exchange rate changes on cash, cash equivalents and restricted cash  (1,336)  2,081   (6,762)  (1,435)
Net increase (decrease) in cash, cash equivalents and restricted cash  (18,959)  8,857   (103,717)  (20,604)
Cash, cash equivalents and restricted cash, beginning of period  169,451   121,031   254,209   150,492 
Cash, cash equivalents and restricted cash, end of period $150,492  $129,888  $150,492  $129,888