Generated $23.3 Million in Consolidated
Revenue, up 131% Year Over Year
Energy Operations Generated $15.8 Million in
Revenue and Industrial Operations Generated $7.0 Million in
Revenue, Up 12% and 11%, Respectively Quarter Over Quarter
Generated $70.4 Million in Operating Cash Flow
During the Nine Months Ended September 30, 2024
Repurchased 3.0 Million Shares for $14.0
Million Via the Company’s Stock Repurchase Program Through November
7, 2024
Subsequent to the Quarter, Acquired Deflecto
for $103.7 Million
Acacia Research Corporation (Nasdaq: ACTG) (“Acacia” or
the “Company”), which acquires and operates businesses
across the industrial, energy and technology sectors, today
reported financial results for the three and nine months ended
September 30, 2024. The Company also posted its third quarter 2024
earnings presentation on its website at www.acaciaresearch.com
under Events & Presentations.
Martin (“MJ”) D. McNulty, Jr., Chief Executive Officer, stated,
“Acacia’s third quarter results reflect the Company’s unwavering
focus on value creation via its core technology, energy and
industrials verticals. The Company generated $23.3 million in
consolidated revenue, up 131% compared to the third quarter last
year, recorded a net loss of $14.0 million and produced $1.7
million of Total Company Adjusted EBITDA, and $6.9 million of
Operated Segment Adjusted EBITDA for the quarter.1 Excluding the
Company’s Intellectual Property Operations, Operated Segment
Adjusted EBITDA was $9.0 million for the quarter. A breakdown of
the Adjusted EBITDA for each of the Company’s operating segments
for the three months ended March 31, June 30 and September 30, and
the nine months ended September 30 is included in this Earnings
Release and in the Company’s third quarter 2024 earnings
presentation.
Subsequent to the quarter, Acacia completed its third
transaction in the last twelve months, acquiring Deflecto
Acquisition, Inc., a leading specialty manufacturer of essential
products serving the commercial transportation, HVAC and office
markets for $103.7 million. I’m excited about the value creation
potential Deflecto offers through product and operational
optimization, and strategic M&A, and look forward to
integrating Deflecto into Acacia’s growing portfolio of strategic
assets.
Following the Deflecto acquisition, the Company’s cash reserves
were approximately $280 million for potential future transactions.
The Company also delivered approximately $14 million to
shareholders as of November 7, 2024, via our stock repurchase
program as part of our long-term strategy to deploy excess cash and
increase total shareholder returns over time.”
Key Business Highlights
- Recorded book value per share of $5.85 at September 30, 2024
compared to $5.90 per share at December 31, 2023. Excluding the
impact of $14.9 million in non-recurring expenses related to legacy
legal matters, which have now been settled, book value per share at
September 30, 2024 would have been $6.00 per share.
- Generated $23.3 million in consolidated revenue for the
quarter, up 131% compared to $10.1 million in revenue in the third
quarter of 2023.
- Recorded a GAAP net loss of $14.0 million, or $0.14 diluted net
loss per share, for the third quarter and a GAAP net loss of $22.6
million, or $0.23 diluted net loss per share, for the first nine
months of 2024.
- Generated $6.9 million and $26.1 million of Operated Segment
Adjusted EBITDA in the three and nine months ended September 30,
2024, respectively.
- Generated $1.7 million and $12.1 million of Total Company
Adjusted EBITDA in the three and nine months ended September 30,
2024, respectively.
- Continued to manage Parent Costs2 within Parent Interest
Income, with Parent Costs of $14.0 million and Parent Interest
Income of $14.7 million, respectively, for the nine months ended
September 30, 2024.
- Generated $70.4 million in operating cash flow during the nine
months ended September 30, 2024.
- Repurchased 3,007,294 shares for approximately $14.0 million as
of November 7, 2024, through the Company’s stock repurchase program
as part of the Company’s overall long-term strategy to deploy
excess cash and increase total shareholder returns over time.
- Subsequent to the quarter, on October 18, acquired Deflecto
Acquisition, Inc. (“Deflecto”) for $103.7 million (the
“Transaction”). Headquartered in Indianapolis, Indiana,
Deflecto is a leading specialty manufacturer of essential products
serving the commercial transportation, HVAC and office markets.
Deflecto is a market leader across each of its segments and end
markets, supplying essential, regulatory mandated products to a
blue-chip customer base via long-term relationships with more than
1,500 leading retail, wholesale and OEM customers and distribution
partners globally. In the trailing twelve-month period ended August
31, 2024, Deflecto generated revenue of approximately $131 million.
Based on current market conditions and trends, Acacia expects
Deflecto to generate approximately $128-$136 million in revenue in
2024. The Transaction was funded utilizing cash on hand and
borrowings under a new senior credit facility secured by Deflecto.
For more information, see the Company’s 8-K filed with the U.S.
Securities and Exchange Commission (the “SEC”) on October
21, 2024.
_________________________
1 Total Company Adjusted EBITDA and
Operated Segment Adjusted EBITDA are non-GAAP financial measures.
See below for a reconciliation of Total Company Adjusted EBITDA to
net loss, the most directly comparable GAAP financial measure. For
the definition of these measures and a reconciliation of the
components of Operated Segment Adjusted EBITDA to their most
directly comparable GAAP financial measures, see the accompanying
supplemental information section.
The following table provides a reconciliation of Total Company
Adjusted EBITDA to consolidated net loss, the most directly
comparable GAAP measure for the three months ended March 31, June
30 and September 30, and the nine months ended September 30.
Three Months Ended
March 31,
Three Months Ended
June 30,
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2024
2024
2024
(In thousands)
(Unaudited)
GAAP Net Loss
$
(186
)
$
(8,446
)
$
(13,996
)
$
(22,628
)
Net (Loss) Income Attributable to
Noncontrolling Interests
(3
)
(383
)
2,339
1,953
Income Tax (Benefit) Expense
(1,109
)
(7,061
)
5,497
(2,673
)
Interest Income and Other, Net
(4,769
)
(3,019
)
(2,022
)
(9,810
)
Loss (Gain) on Foreign Currency
Exchange
68
134
(130
)
72
Net Realized and Unrealized (Gain) / Loss
on Derivatives
(171
)
2,659
(8,034
)
(5,546
)
Net Realized and Unrealized (Gain) / Loss
on Investments
(2,160
)
4,744
4,074
6,658
Non-recurring Legacy Legal Expense
6,243
6,614
2,000
14,857
GAAP Operating Loss
$
(2,087
)
$
(4,758
)
$
(10,272
)
$
(17,117
)
Depreciation, Depletion &
Amortization
4,568
7,405
9,762
21,735
Stock-Based Compensation
858
891
781
2,530
Realized Hedge Gain
800
113
715
1,628
Transaction-Related Costs
—
222
320
542
Legacy Matter Costs
2,193
216
368
2,777
Total Company Adjusted EBITDA
$
6,332
$
4,089
$
1,674
$
12,095
_________________________
2 Parent Cost is a non-GAAP financial
measure. For the definition of this measure and a reconciliation of
this measure to Operating (Loss) Income, the most directly
comparable GAAP financial measure, see the accompanying
supplemental information section.
The following table provides the Adjusted EBITDA for each of the
Company’s operating segments for the three months ended March 31,
June 30 and September 30, and the nine months ended September
30.
Three Months Ended
March 31,
Three Months Ended
June 30,
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2024
2024
2024
(In thousands)
(Unaudited)
Energy Operations Adjusted EBITDA3
$
1,378
$
7,039
$
8,442
$
16,859
Industrial Operations Adjusted EBITDA3
1,897
449
579
2,925
Operated Segment Adjusted EBITDA
(excluding Intellectual Property Operations Adjusted EBITDA)
3,275
7,488
9,021
19,784
Intellectual Property Operations Adjusted
EBITDA3
7,160
1,309
(2,139
)
6,330
Operated Segment Adjusted EBITDA
10,435
8,797
6,882
26,114
Parent Costs
(4,103
)
(4,708
)
(5,208
)
(14,019
)
Total Company Adjusted EBITDA
$
6,332
$
4,089
$
1,674
$
12,095
The following table provides Parent Costs and Parent Interest
Income for the three months ended March 31, June 30 and September
30, and the nine months ended September 30.
Three Months Ended
March 31,
Three Months Ended
June 30,
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2024
2024
2024
(In thousands)
(Unaudited)
Parent Costs
$
(4,103
)
$
(4,708
)
$
(5,208
)
$
(14,019
)
Parent Interest Income
$
5,079
$
5,028
$
4,570
$
14,677
_________________________
3 Energy Operations Adjusted EBITDA,
Industrial Operations Adjusted EBITDA and Intellectual Operations
Adjusted EBITDA are non-GAAP financial measures. For the
definitions of these measures and reconciliations of these measures
to the most directly comparable GAAP financial measures, see the
accompanying supplemental information section.
Third Quarter 2024 Financial Summary and Highlights:
- Total revenues were $23.3 million, up 131% compared to $10.1
million in the same quarter last year.
- Energy Operations generated $15.8 million in revenue in the
quarter. As the Company’s initial investment in Benchmark closed on
November 13, 2023, there is no comparable revenue in the same
quarter last year.
- Industrial Operations generated $7.0 million in revenue during
the quarter, compared to $8.3 million in the same quarter last
year. The decrease in revenue was primarily due to a decrease in
printer sales.
- Intellectual Property Operations generated $0.5 million in
licensing and other revenue during the quarter, compared to $1.8
million in the same quarter last year.
- General and administrative (G&A) expenses were $11.1
million, compared to $11.6 million in the same quarter of last
year. The decrease was primarily due to a decrease in Parent
company G&A partially offset by the addition of the Company’s
new energy segment operations.
- The Company recorded a GAAP operating loss of $10.3 million,
compared to a GAAP operating loss of $13.2 million in the same
quarter of last year primarily due to higher revenues generated.
- Energy Operations contributed $3.1 million in operating income,
which included $4.3 million of non-cash depreciation, depletion and
amortization expenses, $0.3 million in one-time transaction costs
and does not reflect $0.7 million of realized derivatives gain.
Such income includes revenue from the Revolution assets that
Benchmark acquired earlier in 2024. Adjusted EBITDA for Energy
Operations was $8.4 million.
- Industrial Operations contributed $0.1 million in operating
loss which included $0.7 million of non-cash depreciation and
amortization expenses. Adjusted EBITDA for Acacia’s Industrial
Operations was $0.6 million.
- The third quarter included $1.9 million in non-recurring Parent
general and administrative charges.
- The Company recorded GAAP net loss of $14.0 million, or $0.14
diluted net loss per share, compared to GAAP net income of $1.6
million, or $0.03 diluted net loss per share, in the third quarter
of last year.
- Net loss included $4.1 million in unrealized loss related to
the fair value of equity securities at September 30, 2024.
- Net loss included $2.0 million in non-recurring expense related
to legacy legal matters, which have now been settled.
The following table provides a breakdown of the Company’s
financial highlights for the three and nine months ended September
30, 2024 and 2023.
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
(unaudited)
(unaudited)
Intellectual property operations
$
0.5
$
1.8
$
19.4
$
6.3
Industrial operations
7.0
8.3
22.2
26.5
Energy operations
15.8
—
31.8
—
Total revenues
$
23.3
$
10.1
$
73.5
$
32.8
Operating loss
$
(10.3
)
$
(13.2
)
$
(17.1
)
$
(35.0
)
Unrealized gains (losses) 1
$
(4.1
)
$
8.8
$
(35.5
)
$
18.8
Realized gains (losses)
$
—
$
—
$
28.9
$
(9.4
)
Non-recurring legacy legal expense
$
(2.0
)
$
—
$
(14.9
)
$
—
GAAP Net (loss) income
$
(14.0
)
$
1.6
$
(22.6
)
$
(7.7
)
GAAP Diluted net loss per share
$
(0.14
)
$
(0.03
)
$
(0.23
)
$
(0.23
)
1 Unrealized gains and (losses)
are related to the change in fair value of equity securities as of
the end of the reported period and for the nine months ended
September 30, 2024, and include the reversal of the previously
recorded unrealized gain related to the Company’s Arix Bioscience
Plc. position for a realized gain.
Life Sciences Portfolio
Acacia has generated $564.1 million in proceeds from sales and
royalties of its Life Sciences Portfolio, which was purchased for
an aggregate price of $301.4 million in 2020. At September 30, 2024
Acacia’s remaining positions in its Life Sciences Portfolio
represented $25.7 million in book value:
- Acacia holds interests in three private companies, valued at an
aggregate of $25.7 million, net of non-controlling interests,
including an approximately 26% interest in Viamet Pharmaceuticals,
Inc., an approximately 18% interest in AMO Pharma, Ltd. and an
approximately 4% interest in NovaBiotics Ltd. Values are based on
cost or equity accounting.
Balance Sheet and Capital Structure
- Cash, cash equivalents and equity investments measured at fair
value totaled $374.2 million at September 30, 2024 compared to
$403.2 million at December 31, 2023. The decrease in cash was
primarily due to $60.0 million paid to acquire the Revolution
assets, $12.0 million paid on the Benchmark revolving credit
facility and $7.3 million in repurchases of common stock during the
quarter, offset by cash provided by operating activities.
- Equity securities without readily determinable fair value
totaled $5.8 million at September 30, 2024, unchanged from December
31, 2023.
- Investment securities representing equity method investments
totaled $19.9 million at September 30, 2024 (net of noncontrolling
interests), unchanged from December 31, 2023. Acacia owns 64% of
MalinJ1, which results in a 26% indirect ownership stake in Viamet
Pharmaceuticals, Inc. for Acacia.
- The Parent company’s total indebtedness was zero at September
30, 2024. On a consolidated basis, Acacia’s total indebtedness was
$70.0 million in non-recourse debt at Benchmark as of September 30,
2024.
Book Value as of September 30, 2024
At September 30, 2024, Acacia’s book value was $578.6 million
and there were 98.8 million shares of common stock outstanding, for
a book value per share of $5.85. Excluding the impact of $14.9
million in non-recurring expenses related to legacy legal matters,
which have now been settled, the Company’s book value per share at
September 30, 2024 would have been $6.00 per share.
Share Repurchase Program
On November 9, 2023, Acacia’s Board of Directors approved a
stock repurchase program (the “Repurchase Program”) for up
to $20.0 million, subject to a cap of 5,800,000 shares of Acacia
common stock. As of November 7, 2024, the Company has repurchased
3,007,294 common shares for $14.0 million as part of the Company’s
overall long-term strategy to deploy excess cash and increase total
shareholder returns over time. The Company intends to continue to
opportunistically complete share repurchases in the open market
during the fourth quarter of 2024 and into 2025, subject to
operating needs, market conditions, legal requirements, stock price
and other considerations. The Repurchase Program has no time limit
and does not require the repurchase of a minimum number of shares.
The common stock may be repurchased on the open market, in block
trades, or in privately negotiated transactions, including under
plans complying with the provisions of Rule 10b5-1 and Rule 10b-18
of the Exchange Act. Refer to Note 14 to the consolidated financial
statements in the Company’s Quarterly Report on Form 10-Q for the
three months ended September 30, 2024 for additional
information.
Investor Conference Call
The Company will host a conference call today, November 12, 2024
at 8:00 a.m. Eastern Time (5:00 a.m. Pacific Time). To access the
live call, please dial 877-545-0523 (U.S. and Canada) or
973-528-0016 (international) and if requested, reference the access
code “847853.” The conference call will also be simultaneously
webcast at https://www.webcaster4.com/Webcast/Page/2371/51508 and
on the investor relations section of the Company’s website at
http://www.acaciaresearch.com under Events & Presentations.
Following the conclusion of the live call, a replay of the webcast
will be available on the Company's website for at least 30
days.
About the Company
Acacia (Nasdaq: ACTG) is a publicly traded company that is
focused on acquiring and operating attractive businesses across the
mature technology, energy, and industrial/manufacturing sectors
where it believes it can leverage its expertise, significant
capital base, and deep industry relationships to drive value.
Acacia evaluates opportunities based on the attractiveness of the
underlying cash flows, without regard to a specific investment
horizon. Acacia operates its businesses based on three key
principles of people, process and performance and has built a
management team with demonstrated expertise in research,
transactions and execution, and operations and management.
Additional information about Acacia and its subsidiaries is
available at www.acaciaresearch.com.
Safe Harbor Statement
This news release contains forward-looking statements within the
meaning of the “safe harbor” provisions of the Private Securities
Litigation Reform Act of 1995. These statements are based upon the
Company’s current expectations and speak only as of the date
hereof. All statements other than statements of historical fact are
forward-looking statements and include statements related to
estimates and projections with respect to, among other things, the
Company’s anticipated financial condition, operating performance,
the value of the Company’s assets, general economic and market
conditions and other future circumstances and events. This news
release attempts to identify forward-looking statements by using
words such as “anticipate,” “believe,” “continue,” “could,”
“estimate,” “expect,” “forecast,” “future,” “guidance,” “intend,”
“may,” “outlook,” “plan,” “potential,” “predict,” “project,”
“seek,” “should,” “target” and “will,” and similar words and
expressions; however, the absence of these words does not mean that
the statements are not forward-looking. While the Company believes
its assumptions concerning future events are reasonable, a number
of factors could cause actual results to differ materially and
adversely from those expressed or implied in any forward-looking
statements, including, but not limited to: the Company’s ability to
successfully identify, diligence, complete, and integrate strategic
acquisitions of businesses, divisions, and/or assets, the
performance of the Company’s businesses, divisions, and/or assets,
disruptions or uncertainty caused by an ability to retain or
changes to the employees or management teams of the Company’s
businesses, changes to the Company’s relationship and arrangements
with Starboard Value LP, any inability of the Company’s operating
businesses to execute on their business and, with respect to
Benchmark, hedging strategy, risks related to price and other
fluctuations in the oil and gas market, inflationary pressures,
supply chain disruptions or labor shortages, non-performance by
third parties of contractual or legal obligations, changes in the
Company’s credit ratings or the credit ratings of the Company’s
businesses, security threats, including cybersecurity threats and
disruptions to the Company’s business and operations from breaches
of information technology systems, or breaches of information
technology systems, facilities and infrastructure of third parties
with which the Company transacts business, oil or natural gas
production becoming uneconomic, causing write downs or adversely
affecting Benchmark’s ability to borrow, Benchmark’s ability to
replace reserves and efficiently develop current reserves, risks,
operational hazards, unforeseen interruptions and other
difficulties involved in the production of oil and natural gas, the
impact of any seismic events, environmental liability risk,
regulatory changes related to the oil and gas industry, the ability
to successfully develop licensing programs and attract new
business, changes in demand for current and future intellectual
property rights, legislative, regulatory and competitive
developments addressing licensing and enforcement of patents and/or
intellectual property in general, the decrease in demand for
Printronix' products, changes in safety, health, environmental, tax
and other regulations, requirements or initiatives, hazards such as
weather conditions, a health pandemic (similar to COVID-19), acts
of war or terrorist acts and the government or military response
thereto, general economic conditions, and the success of the
Company’s investments. For further discussions of risks and
uncertainties, you should refer to the Company’s filings with the
Securities and Exchange Commission, including the “Risk Factors”
section of the Company’s most recent Annual Report on Form 10-K and
any subsequent Quarterly Reports on Form 10-Q. In addition, actual
results may differ materially as a result of additional risks and
uncertainties of which the Company is currently unaware or which
the Company does not currently view as material. Except as
otherwise required by applicable law, the Company undertakes no
obligation to revise or update publicly any forward-looking
statements for any reason.
ACACIA RESEARCH
CORPORATION
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands, except share
and per share data)
September 30, 2024
December 31, 2023
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
360,050
$
340,091
Equity securities
14,100
63,068
Equity securities without readily
determinable fair value
5,816
5,816
Equity method investments
30,934
30,934
Accounts receivable, net
10,733
80,555
Inventories
12,218
10,921
Prepaid expenses and other current
assets
23,795
23,127
Total current assets
457,646
554,512
Property, plant and equipment, net
2,366
2,356
Oil and natural gas properties, net
190,149
25,117
Goodwill
8,990
8,990
Other intangible assets, net
30,872
33,556
Operating lease, right-of-use assets
1,366
1,872
Deferred income tax assets, net
8,424
2,915
Other non-current assets
7,759
4,227
Total assets
$
707,572
$
633,545
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable
$
5,258
$
3,261
Accrued expenses and other current
liabilities
8,668
8,405
Accrued compensation
4,969
4,207
Current asset retirement obligation
1,562
—
Royalties and contingent legal fees
payable
6,194
10,786
Deferred revenue
1,268
977
Total current liabilities
27,919
27,636
Asset retirement obligation
28,065
—
Long-term lease liabilities
1,251
1,736
Revolving credit facility
70,000
10,525
Other long-term liabilities
1,771
4,039
Total liabilities
129,006
43,936
Commitments and contingencies
Stockholders' equity:
Preferred stock, par value $0.001 per
share; 10,000,000 shares authorized; no shares issued or
outstanding
—
—
Common stock, par value $0.001 per share;
300,000,000 shares authorized; 98,838,337 and 99,895,473 shares
issued and outstanding as of September 30, 2024 and December 31,
2023, respectively
99
100
Treasury stock, at cost, 17,720,825 and
16,183,703 shares as of September 30, 2024 and December 31, 2023,
respectively
(105,560
)
(98,258
)
Additional paid-in capital
907,996
906,153
Accumulated deficit
(262,357
)
(239,729
)
Total Acacia Research Corporation
stockholders' equity
540,178
568,266
Noncontrolling interests
38,388
21,343
Total stockholders' equity
578,566
589,609
Total liabilities and stockholders'
equity
$
707,572
$
633,545
ACACIA RESEARCH
CORPORATION
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share
and per share data)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
Revenues:
Intellectual property operations
$
486
$
1,760
$
19,442
$
6,330
Industrial operations
7,007
8,324
22,183
26,461
Energy operations
15,817
—
31,843
—
Total revenues
23,310
10,084
73,468
32,791
Costs and expenses:
Cost of revenues - intellectual property
operations
5,707
5,470
18,473
15,218
Cost of revenues - industrial
operations
3,523
4,377
10,849
13,530
Cost of production - energy operations
11,729
—
23,082
—
Engineering and development expenses -
industrial operations
108
172
420
593
Sales and marketing expenses - industrial
operations
1,391
1,613
4,333
5,385
General and administrative expenses
11,124
11,605
33,428
33,071
Total costs and expenses
33,582
23,237
90,585
67,797
Operating loss
(10,272
)
(13,153
)
(17,117
)
(35,006
)
Other income (expense):
Equity securities investments:
Change in fair value of equity
securities
(4,074
)
8,823
(35,519
)
18,783
Gain (loss) on sale of equity
securities
—
—
28,861
(9,360
)
Earnings on equity investment in joint
venture
—
3,375
—
3,375
Net realized and unrealized (loss)
gain
(4,074
)
12,198
(6,658
)
12,798
Non-recurring legacy legal expense
(2,000
)
—
(14,857
)
—
Change in fair value of the Series B
warrants and embedded derivatives
—
1,525
—
8,241
Gain on derivatives - energy
operations
8,034
—
5,546
—
Gain (loss) on foreign currency
exchange
130
(70
)
(72
)
25
Interest expense on Senior Secured
Notes
—
(130
)
—
(1,930
)
Interest income and other, net
2,022
2,195
9,810
9,943
Total other income (expense)
4,112
15,718
(6,231
)
29,077
(Loss) income before income taxes
(6,160
)
2,565
(23,348
)
(5,929
)
Income tax (expense) benefit
(5,497
)
197
2,673
(641
)
Net (loss) income including noncontrolling
interests in subsidiaries
(11,657
)
2,762
(20,675
)
(6,570
)
Net loss attributable to noncontrolling
interests in subsidiaries
(2,339
)
(1,126
)
(1,953
)
(1,126
)
Net (loss) income attributable to Acacia
Research Corporation
$
(13,996
)
$
1,636
$
(22,628
)
$
(7,696
)
Loss per share:
Net loss attributable to common
stockholders - Basic
$
(13,996
)
$
(1,741
)
$
(22,628
)
$
(15,703
)
Weighted average number of shares
outstanding - Basic
99,854,723
94,328,452
99,893,336
67,072,835
Basic net loss per common share
$
(0.14
)
$
(0.02
)
$
(0.23
)
$
(0.23
)
Net loss attributable to common
stockholders - Diluted
$
(13,996
)
$
(3,164
)
$
(22,628
)
$
(15,703
)
Weighted average number of shares
outstanding - Diluted
99,854,723
99,122,973
99,893,336
67,072,835
Diluted net loss per common share
$
(0.14
)
$
(0.03
)
$
(0.23
)
$
(0.23
)
ACACIA RESEARCH CORPORATION - SUPPLEMENTAL
INFORMATION NON-GAAP FINANCIAL MEASURE
This earnings release includes adjusted EBITDA on a consolidated
basis and for each of the Company’s segments. Total Company
Adjusted EBITDA, Operated Segment Adjusted EBITDA and adjusted
EBITDA for each of the Company’s segments are supplemental non-GAAP
financial measures used by management and external users of the
Company’s consolidated financial statements. GAAP refers to
generally accepted accounting principles in the United States. A
non-GAAP financial measure is a numerical measure of historical or
future performance, financial position or cash flow that includes
or excludes amounts that are excluded or included, respectively, in
the most directly comparable measure calculated and presented in
accordance with GAAP in the Company’s financial statements.
Total Company Adjusted EBITDA is defined as net income / (loss)
before net income / (loss) attributable to noncontrolling
interests, income tax (benefit) / expense, interest income and
other, net, loss / (gain) on foreign currency exchange, net
realized and unrealized (gain) / loss on derivatives, net realized
and unrealized loss / (gain) on investments, non-recurring legacy
legal expenses, depreciation, depletion and amortization,
stock-based compensation, realized hedge gain / (loss),
transaction-related costs, and costs related to certain legacy
items. Operated Segment Adjusted EBITDA is the aggregate of Energy
Operations Adjusted EBITDA, Industrial Operations Adjusted EBITDA
and Intellectual Property Operations Adjusted EBITDA. The Company
is providing Total Company Adjusted EBITDA and Operated Segment
Adjusted EBITDA, non-GAAP financial measures, because management
believes these metrics provide investors with useful supplemental
information in comparing the operating results across reporting
periods by excluding items that are not considered indicative of
core operating performance. These measures are not intended to
replace the presentation of financial results in accordance with
GAAP and may be different from or otherwise inconsistent with
similar non-GAAP financial measures used by other companies. The
presentation of these non-GAAP financial measures supplements other
metrics the Company uses to internally evaluate its subsidiary
businesses and facilitate the comparison of past and present
operating performance. These measures should not be considered in
isolation or as a substitute for measures calculated and presented
in accordance with GAAP.
Energy Operations
Energy Operations Adjusted EBITDA is defined as operating income
/ (loss) for Acacia’s Energy Operations before depreciation,
depletion and amortization expense and transaction related costs,
and including realized hedge gain / (loss). The Company is
providing its Energy Operations’ Adjusted EBITDA, a non-GAAP
financial measure, because the metric provides investors with
useful supplemental information in comparing the operating results
across reporting periods by excluding items that are not considered
indicative of core operating performance.
Industrial Operations
Industrial Operations Adjusted EBITDA is defined as operating
income / (loss) for Acacia’s Industrial Operations before
intangibles amortization and depreciation and amortization expense.
The Company is providing its Industrial Operations’ Adjusted
EBITDA, a non-GAAP financial measure, because the metric provides
investors with useful supplemental information in comparing the
operating results across reporting periods by excluding items that
are not considered indicative of core operating performance.
Intellectual Property Operations
Intellectual Property Operations Adjusted EBITDA is defined as
operating income / (loss) for Acacia’s Intellectual Property
Operations before patent amortization, depreciation and
amortization expense and stock-based compensation. The Company is
providing Intellectual Property Operations’ Adjusted EBITDA, a
non-GAAP financial measure, because the metric provides investors
with useful supplemental information in comparing the operating
results across reporting periods by excluding items that are not
considered indicative of core operating performance.
Parent Costs
Parent Costs are defined as operating income / (loss)
attributable to Parent before depreciation and amortization
expense, stock-based compensation, and costs related to certain
legacy matters attributable to the Parent organization. The Company
is providing Parent Costs, a non-GAAP financial measure, because it
believes it gives the investor a clear picture of a normalized
parent-level expense burden.
The following tables reconcile the most directly comparable GAAP
financial measures to Adjusted EBITDA for each of the Company’s
operating segments and for Parent Costs for the three months ended
March 31, June 30 and September 30, and the nine months ended
September 30.
Three Months Ended March 31,
2024
Adjusted
EBITDA
Energy
Operations
Industrial
Operations
Intellectual Property
Operations
Parent Costs
Consolidated
Total
(In thousands)
(Unaudited)
GAAP Operating (Loss) Income
$
156
$
1,212
$
3,282
$
(6,737
)
$
(2,087
)
Depreciation, Depletion &
Amortization
422
685
3,435
26
4,568
Stock-Based Compensation
—
—
443
415
858
Realized Hedge Gain
800
—
—
—
800
Transaction-Related Costs
—
—
—
—
—
Legacy Matter Costs
—
—
—
2,193
2,193
Adjusted EBITDA
$
1,378
$
1,897
$
7,160
$
(4,103
)
$
6,332
Parent Interest Income
$
5,079
Three Months Ended June 30,
2024
Adjusted
EBITDA
Energy
Operations
Industrial
Operations
Intellectual Property
Operations
Parent Costs
Consolidated
Total
(In thousands)
(Unaudited)
GAAP Operating (Loss) Income
$
3,249
$
(234
)
$
(2,253
)
$
(5,520
)
$
(4,758
)
Depreciation, Depletion &
Amortization
3,455
683
3,241
26
7,405
Stock-Based Compensation
—
—
321
570
891
Realized Hedge Gain
113
—
—
—
113
Transaction-Related Costs
222
—
—
—
222
Legacy Matter Costs
—
—
—
216
216
Adjusted EBITDA
$
7,039
$
449
$
1,309
$
(4,708
)
$
4,089
Parent Interest Income
$
5,028
Three Months Ended September
30, 2024
Adjusted
EBITDA
Energy
Operations
Industrial
Operations
Intellectual Property
Operations
Parent Costs
Consolidated
Total
(In thousands)
(Unaudited)
GAAP Operating (Loss) Income
$
3,064
$
(101
)
$
(7,138
)
$
(6,097
)
$
(10,272
)
Depreciation, Depletion &
Amortization
4,343
680
4,714
25
9,762
Stock-Based Compensation
—
—
285
496
781
Realized Hedge Gain
715
—
—
—
715
Transaction-Related Costs
320
—
—
—
320
Legacy Matter Costs
—
—
—
368
368
Adjusted EBITDA
$
8,442
$
579
$
(2,139
)
$
(5,208
)
$
1,674
Parent Interest Income
$
4,570
Nine Months Ended September
30, 2024
Adjusted
EBITDA
Energy
Operations
Industrial
Operations
Intellectual Property
Operations
Parent Costs
Consolidated
Total
(In thousands)
(Unaudited)
GAAP Operating (Loss) Income
$
6,469
$
877
$
(6,109
)
$
(18,354
)
$
(17,117
)
Depreciation, Depletion &
Amortization
8,220
2,048
11,390
77
21,735
Stock-Based Compensation
—
—
1,049
1,481
2,530
Realized Hedge Gain
1,628
—
—
—
1,628
Transaction-Related Costs
542
—
—
—
542
Legacy Matter Costs
—
—
—
2,777
2,777
Adjusted EBITDA
$
16,859
$
2,925
$
6,330
$
(14,019
)
$
12,095
Parent Interest Income
$
14,677
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241112999797/en/
Investor Contact:
Gagnier Communications ir@acaciares.com
Acacia Research Technolo... (NASDAQ:ACTG)
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