MITEK SYSTEMS INC
For the period ended Aug 8, 2024. Filed Aug 8, 2024.
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A notice of a major event between regular reports, such as results, a deal or a change of executives. It is often the first formal record of the news.
Aug 8, 2024 · Filed Aug 8, 2024
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Contents
EX-99.1 · (amounts in thousands except per share data)
(amounts in thousands except per share data)
| Three Months Ended June 30, | Nine Months Ended June 30, | |||
|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |
| Net income (loss) | $216 | $(428) | $(5,295) | $9,471 |
| Non-GAAP adjustments: | ||||
| Acquisition-related costs and expenses(1) | 3,749 | 6,207 | 11,581 | 15,302 |
| Litigation and other legal costs(2) | 157 | 393 | 3,244 | 1,119 |
| Executive transition costs | 1,265 | 91 | 2,033 | 672 |
| Stock-based compensation expense | 3,585 | 2,644 | 10,901 | 7,790 |
| Non-recurring audit fees | 1,014 | 812 | 5,025 | 2,185 |
| Enterprise risk, portfolio positioning and other related costs(3) | — | — | 996 | — |
| Restructuring costs(4) | 1,070 | 14 | 1,648 | 2,000 |
| Amortization of debt discount and issuance costs | 2,081 | 1,909 | 6,057 | 5,609 |
| Income tax effect of pre-tax adjustments | (1,880) | (3,415) | (9,274) | (9,113) |
| Cash tax difference(5) | 740 | 1,243 | 2,939 | 2,410 |
| Non-GAAP net income | $11,997 | $9,470 | $29,855 | $37,445 |
| Non-GAAP income per share—basic | $0.26 | $0.21 | $0.64 | $0.82 |
| Non-GAAP income per share—diluted | $0.25 | $0.20 | $0.62 | $0.81 |
| Shares used in calculating non-GAAP net income per share—basic | 47,017 | 46,002 | 46,764 | 45,625 |
| Shares used in calculating non-GAAP net income per share—diluted | 48,307 | 46,473 | 47,792 | 46,210 |
(1)Amortization of intangible assets recognized primarily from the ID R&D and HooYu acquisitions and the change in fair value of acquisition-related contingent consideration.
(2)During the three and nine month periods ended December 31, 2023 and June 30, 2024, our legal team used third party legal experts to perform and provide advice regarding a variety of activities including intellectual property litigation matters and risk analysis and in providing support for customers in their litigation, matters and options related to getting our SEC filings current, the process for a potential delisting from the Nasdaq Capital Market, ongoing litigation support, and various other projects.
(3)During the nine months ended June 30, 2024, we used three third party experts to evaluate our product portfolio positioning, competitive landscape, enterprise risk and other related analyses.
(4)Restructuring costs consist of employee severance obligations and other related costs. Restructuring costs were $1.6 million in the nine months ended June 30, 2024 and were related to expenses incurred to relocate employees and a restructuring that occurred in the third quarter of fiscal 2024. Restructuring costs were $2.0 million in the nine months ended June 30, 2023 and were related to a restructuring plan that was initially implemented in June and November 2022.
(5)The Company’s non-GAAP net income is calculated using a cash tax rate of 13% in fiscal 2024 and 23% in fiscal 2023. The estimated cash tax rate is the estimated annual tax payable on the Company’s tax returns as a percentage of estimated annual non-GAAP pre-tax net income. The Company uses an estimated cash tax rate to adjust for the historical variation in the effective book tax rate associated with the reversal of valuation allowances, and the utilization of research and development tax credits which currently have an overall effect of reducing taxes payable. The Company believes that the cash tax rate provides a more transparent view of the Company’s operating results. The Company’s effective tax rate used for the purposes of calculating GAAP net income for fiscal 2024 and 2023 was 35% and 32%, respectively.
| MITEK SYSTEMS, INC. | ||||
|---|---|---|---|---|
| NON-GAAP OPERATING INCOME RECONCILIATION | ||||
| (Unaudited) | ||||
| (amounts in thousands) | ||||
| Three Months Ended June 30, | Nine Months Ended June 30, | |||
| 2024 | 2023 | 2024 | 2023 | |
| GAAP operating income | $734 | $1,792 | $(5,484) | $18,851 |
| Non-GAAP adjustments: | ||||
| Acquisition-related costs and expenses | 3,749 | 6,207 | 11,581 | 15,302 |
| Litigation and other legal costs | 157 | 393 | 3,244 | 1,119 |
| Executive transition costs | 1,265 | 91 | 2,033 | 672 |
| Stock-based compensation expense | 3,585 | 2,644 | 10,901 | 7,790 |
| Non-recurring audit fees | 1,014 | 812 | 5,025 | 2,185 |
| Enterprise risk, portfolio positioning and other related costs | — | — | 996 | — |
| Restructuring costs | 1,070 | 14 | 1,648 | 2,000 |
| Non-GAAP operating income | $11,574 | $11,953 | $29,944 | $47,919 |
| Total Revenue | $44,976 | $43,070 | $128,861 | $134,896 |
| Non-GAAP operating margin | 26% | 28% | 23% | 36% |
| MITEK SYSTEMS, INC. | ||||
|---|---|---|---|---|
| SUPPLEMENTAL RECONCILIATIONS OF GAAP ACTUALS TO NON-GAAP ACTUALS | ||||
| (Unaudited) | ||||
| (amounts in thousands) | ||||
| Three Months Ended June 30, · Nine Months Ended June 30, | ||||
| 2024 · 2023 · 2024 · 2023 | ||||
| Selling and marketing | $10,354 | $10,296 | $31,231 | $29,434 |
| Non-GAAP adjustments: | ||||
| Stock-based compensation expense | 818 | 885 | 2,579 | 2,423 |
| Non-GAAP Selling and marketing | $9,536 | $9,411 | $28,652 | $27,011 |
| Research and development | $9,982 | $7,461 | $28,569 | $22,504 |
| Non-GAAP adjustments: | ||||
| Stock-based compensation expense | 1,344 | 644 | 3,751 | 2,097 |
| Non-GAAP Research and development | $8,638 | $6,817 | $24,818 | $20,407 |
| General and administrative | $12,604 | $11,588 | $43,085 | $30,126 |
| Non-GAAP adjustments: | ||||
| Stock-based compensation expense | 1,229 | 991 | 4,124 | 2,954 |
| Litigation and other legal costs | 157 | 393 | 3,244 | 1,119 |
| Executive transition costs | 1,265 | 91 | 2,033 | 672 |
| Non-recurring audit fees | 1,014 | 812 | 5,025 | 2,185 |
| Enterprise risk, portfolio positioning and other related costs | — | — | 996 | — |
| Non-GAAP General and administrative | $8,939 | $9,301 | $27,663 | $23,196 |
| Total Non-GAAP Operating Expense | $27,113 | $25,529 | $81,133 | $70,614 |
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