(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Exhibit No. | Exhibit Description | ||||
99.1 | |||||
99.2 | |||||
99.3 | |||||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
MERIDIANLINK, INC. | ||||||||
Date: March 1, 2023 | ||||||||
By: | /s/ Sean Blitchok | |||||||
Sean Blitchok | ||||||||
Chief Financial Officer |
As of | |||||||||||
December 31, 2022 | December 31, 2021 | ||||||||||
Assets | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 55,780 | $ | 113,645 | |||||||
Accounts receivable, net of allowance for doubtful accounts | 32,905 | 24,913 | |||||||||
Prepaid expenses and other current assets | 9,447 | 9,398 | |||||||||
Escrow deposit | 30,000 | — | |||||||||
Total current assets | 128,132 | 147,956 | |||||||||
Property and equipment, net | 4,245 | 5,989 | |||||||||
Right of use assets | 2,185 | — | |||||||||
Intangible assets, net | 297,475 | 298,597 | |||||||||
Deferred tax assets, net | 13,939 | 4,286 | |||||||||
Goodwill | 608,657 | 564,799 | |||||||||
Other assets | 4,524 | 4,266 | |||||||||
Total assets | $ | 1,059,157 | $ | 1,025,893 | |||||||
Liabilities and Stockholders’ Equity | |||||||||||
Current liabilities: | |||||||||||
Accounts payable | $ | 1,249 | $ | 2,335 | |||||||
Accrued liabilities | 32,500 | 24,667 | |||||||||
Deferred revenue | 16,945 | 14,707 | |||||||||
Current portion of long-term debt, net of debt issuance costs | 3,505 | 2,139 | |||||||||
Total current liabilities | 54,199 | 43,848 | |||||||||
Long-term debt, net of debt issuance costs | 423,404 | 425,371 | |||||||||
Long-term deferred revenue | 1,141 | — | |||||||||
Deferred rent | — | 396 | |||||||||
Other long-term liabilities | 1,322 | — | |||||||||
Total liabilities | 480,066 | 469,615 | |||||||||
Commitments and contingencies | |||||||||||
Stockholders’ Equity | |||||||||||
Preferred stock, $0.001 par value; 50,000,000 shares authorized; zero shares issued and outstanding at December 31, 2022 and 2021 | — | — | |||||||||
Common stock, $0.001 par value; 600,000,000 shares authorized, 80,644,452 and 79,734,984 shares issued and outstanding at December 31, 2022 and 2021, respectively | 128 | 88 | |||||||||
Additional paid-in capital | 621,396 | 596,542 | |||||||||
Accumulated deficit | (42,433) | (40,352) | |||||||||
Total stockholders’ equity | 579,091 | 556,278 | |||||||||
Total liabilities and stockholders’ equity | $ | 1,059,157 | $ | 1,025,893 |
Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Revenues, net | $ | 70,551 | $ | 64,024 | $ | 288,046 | $ | 267,676 | |||||||||||||||
Cost of revenues: | |||||||||||||||||||||||
Subscription and services | 22,486 | 19,025 | 90,778 | 77,103 | |||||||||||||||||||
Amortization of developed technology | 4,266 | 3,329 | 15,553 | 12,519 | |||||||||||||||||||
Total cost of revenues | 26,752 | 22,354 | 106,331 | 89,622 | |||||||||||||||||||
Gross profit | 43,799 | 41,670 | 181,715 | 178,054 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
General and administrative | 22,233 | 21,057 | 82,649 | 85,160 | |||||||||||||||||||
Research and development | 12,178 | 8,529 | 42,592 | 36,336 | |||||||||||||||||||
Sales and marketing | 7,139 | 4,305 | 23,658 | 18,122 | |||||||||||||||||||
Acquisition related costs | 1,679 | — | 4,228 | 781 | |||||||||||||||||||
Total operating expenses | 43,229 | 33,891 | 153,127 | 140,399 | |||||||||||||||||||
Operating income | 570 | 7,779 | 28,588 | 37,655 | |||||||||||||||||||
Other (income) expense, net: | |||||||||||||||||||||||
Other income | (357) | (10) | (1,063) | (49) | |||||||||||||||||||
Interest expense, net | 7,578 | 5,542 | 24,227 | 32,615 | |||||||||||||||||||
Loss on debt repayment and extinguishment | — | 5,593 | — | 9,944 | |||||||||||||||||||
Total other expense, net | 7,221 | 11,125 | 23,164 | 42,510 | |||||||||||||||||||
Income (loss) before provision for income taxes | (6,651) | (3,346) | 5,424 | (4,855) | |||||||||||||||||||
Provision for (benefit from) income taxes | (1,188) | (133) | 4,130 | 5,141 | |||||||||||||||||||
Net income (loss) | (5,463) | (3,213) | 1,294 | (9,996) | |||||||||||||||||||
Class A preferred return | — | — | — | (20,944) | |||||||||||||||||||
Net income (loss) attributable to common stockholders | $ | (5,463) | $ | (3,213) | $ | 1,294 | $ | (30,940) | |||||||||||||||
Net income (loss) per share: | |||||||||||||||||||||||
Basic | $ | (0.07) | $ | (0.04) | $ | 0.02 | $ | (0.48) | |||||||||||||||
Diluted | (0.07) | (0.04) | 0.02 | (0.48) | |||||||||||||||||||
Weighted average common stock outstanding: | |||||||||||||||||||||||
Basic | 80,749,744 | 79,596,418 | 80,454,356 | 63,813,770 | |||||||||||||||||||
Diluted | 80,749,744 | 79,596,418 | 82,403,679 | 63,813,770 |
Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Subscription fees | $ | 60,004 | $ | 55,757 | $ | 248,864 | $ | 235,489 | |||||||||||||||
Professional services | 8,250 | 5,895 | 29,320 | 22,707 | |||||||||||||||||||
Other | 2,297 | 2,372 | 9,862 | 9,480 | |||||||||||||||||||
Total | $ | 70,551 | $ | 64,024 | $ | 288,046 | $ | 267,676 |
Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Lending software solutions | $ | 55,041 | $ | 43,759 | $ | 208,290 | $ | 176,793 | |||||||||||||||
Data verification software solutions | 15,510 | 20,265 | 79,756 | 90,883 | |||||||||||||||||||
Total (1) | $ | 70,551 | $ | 64,024 | $ | 288,046 | $ | 267,676 | |||||||||||||||
% Growth attributable to: | |||||||||||||||||||||||
Lending software solutions | 18% | 12% | |||||||||||||||||||||
Data verification software | (7)% | (4)% | |||||||||||||||||||||
Total % growth | 10% | 8% | |||||||||||||||||||||
(1) % Revenue related to mortgage loan market: | |||||||||||||||||||||||
Lending software solutions | 10% | 9% | 8% | 9% | |||||||||||||||||||
Data verification software | 59% | 68% | 64% | 70% | |||||||||||||||||||
Total % revenue related to mortgage loan market | 21% | 27% | 23% | 30% |
Year Ended December 31, | |||||||||||
2022 | 2021 | ||||||||||
Cash flows from operating activities: | |||||||||||
Net income (loss) | $ | 1,294 | $ | (9,996) | |||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||||||
Depreciation and amortization | 53,982 | 50,453 | |||||||||
Amortization of debt issuance costs | 2,760 | 3,413 | |||||||||
Share-based compensation expense | 22,761 | 30,736 | |||||||||
Loss on disposal of fixed assets | 678 | 524 | |||||||||
Loss on sublease liability | — | 405 | |||||||||
Loss on debt repayment and extinguishment | — | 9,944 | |||||||||
Gain on change in fair value of earnout | (162) | — | |||||||||
Other adjustments | — | (18) | |||||||||
Deferred income taxes | 1,905 | 4,926 | |||||||||
Changes in operating assets and liabilities, net of acquisitions: | |||||||||||
Accounts receivable | (7,005) | 1,619 | |||||||||
Prepaid expenses and other assets | 297 | (5,726) | |||||||||
Accounts payable | (1,564) | 117 | |||||||||
Accrued liabilities | (2,281) | (302) | |||||||||
Deferred revenue | 1,922 | 3,834 | |||||||||
Deferred rent | — | (94) | |||||||||
Net cash provided by operating activities | 74,587 | 89,835 | |||||||||
Cash flows from investing activities: | |||||||||||
Acquisition, net of cash acquired – Beanstalk Networks L.L.C. | (61,830) | — | |||||||||
Acquisition, net of cash and restricted cash acquired – StreetShares, Inc. | (23,137) | — | |||||||||
Acquisition, net of cash and restricted cash acquired – Saylent Technologies, Inc. | — | (35,945) | |||||||||
Acquisition, net of cash acquired – TazWorks, LLC | — | (84,605) | |||||||||
Escrow deposit | (30,000) | — | |||||||||
Capitalized software additions | (8,228) | (4,906) | |||||||||
Purchases of property and equipment | (1,136) | (843) | |||||||||
Net cash used in investing activities | (124,331) | (126,299) | |||||||||
Cash flows from financing activities: | |||||||||||
Repurchases of common stock | (3,375) | — | |||||||||
Repurchases of Class A Units | — | (54) | |||||||||
Repurchases of Class B Units | — | (1,887) | |||||||||
Proceeds from initial public offering, net of underwriters’ discounts and commissions | — | 247,307 | |||||||||
Proceeds from exercise of stock options | 211 | 1,714 | |||||||||
Payment due to effect of corporate conversion | — | (6) | |||||||||
Proceeds from employee stock purchase plan | 1,777 | — | |||||||||
Taxes paid related to net share settlement of RSUs | (206) | — | |||||||||
Proceeds from long-term debt | — | 535,000 | |||||||||
Principal payments of long-term debt | (3,263) | (631,255) | |||||||||
Payment of Regulation A+ investor note | (3,265) | — | |||||||||
Payments of debt issuance costs | — | (7,207) | |||||||||
Payments of Class A cumulative preferred return | — | (12) | |||||||||
Payments of deferred offering costs | — | (4,790) | |||||||||
Payment to sellers of Saylent Technologies, Inc. | — | (775) | |||||||||
Payment to sellers of Teledata Communications, Inc | — | (2,142) | |||||||||
Holdback payment to sellers of MeridianLink | — | (25,665) | |||||||||
Net cash (used in) provided by financing activities | (8,121) | 110,228 | |||||||||
Net (decrease) increase in cash, cash equivalents and restricted cash | (57,865) | 73,764 | |||||||||
Cash, cash equivalents and restricted cash, beginning of period | 113,645 | 39,881 | |||||||||
Cash, cash equivalents and restricted cash, end of period | $ | 55,780 | $ | 113,645 | |||||||
Year Ended December 31, | |||||||||||
2022 | 2021 | ||||||||||
Supplemental disclosures of cash flow information: | |||||||||||
Cash paid for interest | $ | 21,348 | $ | 29,242 | |||||||
Cash paid for income taxes | 1,343 | 306 | |||||||||
Non-cash investing and financing activities: | |||||||||||
Regulation A+ investor note assumed in business combination | $ | 3,265 | $ | — | |||||||
Initial recognition of operating lease liability | 3,791 | — | |||||||||
Initial recognition of operating lease right-of-use asset | 3,047 | — | |||||||||
Share-based compensation expense capitalized to software additions | 311 | 111 | |||||||||
Shares withheld with respect to net settlement of RSUs | 206 | — | |||||||||
Effect of corporate conversion | — | 319,868 | |||||||||
Related party receivable net against holdback payment to prior shareholders | — | 4,335 | |||||||||
Deferred offering costs in prepaid expenses and other current assets as of December 31, 2020 offsetting payments of deferred offering costs | — | 423 | |||||||||
Vesting of RSAs and RSUs | 40 | 94 | |||||||||
Debt issuance costs included in accrued expenses | — | 90 | |||||||||
Purchases of property and equipment included in accounts payable and accrued expenses | 72 | 81 | |||||||||
Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Operating income | $ | 570 | $ | 7,779 | $ | 28,588 | $ | 37,655 | |||||||||||||||
Add: Share-based compensation expense | 6,260 | 3,901 | 22,761 | 30,736 | |||||||||||||||||||
Add: Employer payroll taxes on employee stock transactions | 20 | 16 | 350 | 95 | |||||||||||||||||||
Add: Sponsor and third-party acquisition related costs | 1,679 | 25 | 4,228 | 2,348 | |||||||||||||||||||
Non-GAAP operating income | $ | 8,529 | $ | 11,721 | $ | 55,927 | $ | 70,834 | |||||||||||||||
Non-GAAP operating margin | 12% | 18% | 19% | 26% | |||||||||||||||||||
Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Net income (loss) | $ | (5,463) | $ | (3,213) | $ | 1,294 | $ | (9,996) | |||||||||||||||
Add: Share-based compensation expense | 6,260 | 3,901 | 22,761 | 30,736 | |||||||||||||||||||
Add: Employer payroll taxes on employee stock transactions | 20 | 16 | 350 | 95 | |||||||||||||||||||
Add: Sponsor and third-party acquisition related costs | 1,679 | 25 | 4,228 | 2,348 | |||||||||||||||||||
Non-GAAP net income | $ | 2,496 | $ | 729 | $ | 28,633 | $ | 23,183 | |||||||||||||||
Non-GAAP basic net income per share | $ | 0.03 | $ | 0.01 | $ | 0.36 | $ | 0.36 | |||||||||||||||
Non-GAAP diluted net income per share | 0.03 | 0.01 | 0.35 | 0.35 | |||||||||||||||||||
Weighted average shares used to compute Non-GAAP basic net income per share | 80,749,744 | 79,596,418 | 80,454,356 | 63,813,770 | |||||||||||||||||||
Weighted average shares used to compute Non-GAAP diluted net income per share | 82,413,712 | 82,358,079 | 82,403,679 | 67,130,479 | |||||||||||||||||||
Non-GAAP net income margin | 4% | 1% | 10% | 9% | |||||||||||||||||||
Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Net income (loss) | $ | (5,463) | $ | (3,213) | $ | 1,294 | $ | (9,996) | |||||||||||||||
Interest expense | 7,578 | 5,542 | 24,227 | 32,615 | |||||||||||||||||||
Taxes | (1,188) | (133) | 4,130 | 5,141 | |||||||||||||||||||
Depreciation and amortization | 14,234 | 12,799 | 53,982 | 50,453 | |||||||||||||||||||
Share-based compensation expense | 6,260 | 3,901 | 22,761 | 30,736 | |||||||||||||||||||
Employer payroll taxes on employee stock transactions | 20 | 16 | 350 | 95 | |||||||||||||||||||
Expenses associated with IPO | — | — | — | 424 | |||||||||||||||||||
Sponsor and third-party acquisition related costs | 1,679 | 25 | 4,228 | 2,348 | |||||||||||||||||||
Loss on debt prepayment | — | 5,593 | — | 9,944 | |||||||||||||||||||
Deferred revenue reduction from purchase accounting for acquisitions prior to 2022 | 51 | 109 | 227 | 733 | |||||||||||||||||||
Lease termination charges | — | — | — | 879 | |||||||||||||||||||
Adjusted EBITDA | $ | 23,171 | $ | 24,639 | $ | 111,199 | $ | 123,372 | |||||||||||||||
Adjusted EBITDA margin | 33% | 38% | 39% | 46% | |||||||||||||||||||
Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Cost of revenue | $ | 26,752 | $ | 22,354 | $ | 106,331 | $ | 89,622 | |||||||||||||||
Less: Share-based compensation expense | 1,063 | 1,017 | 4,630 | 6,478 | |||||||||||||||||||
Less: Employer payroll taxes on employee stock transactions | 6 | — | 127 | 3 | |||||||||||||||||||
Less: Amortization of developed technology | 4,266 | 3,329 | 15,553 | 12,519 | |||||||||||||||||||
Non-GAAP cost of revenue | $ | 21,417 | $ | 18,008 | $ | 86,021 | $ | 70,622 | |||||||||||||||
As a % of revenue | 30% | 28% | 30% | 26% | |||||||||||||||||||
Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
General & administrative | $ | 22,233 | $ | 21,057 | $ | 82,649 | $ | 85,160 | |||||||||||||||
Less: Share-based compensation expense | 2,552 | 1,694 | 9,499 | 14,558 | |||||||||||||||||||
Less: Employer payroll taxes on employee stock transactions | 6 | 14 | 81 | 73 | |||||||||||||||||||
Less: Depreciation expense | 599 | 560 | 2,319 | 2,303 | |||||||||||||||||||
Less: Amortization of intangibles | 9,369 | 8,910 | 36,110 | 35,631 | |||||||||||||||||||
Non-GAAP general & administrative | $ | 9,707 | $ | 9,879 | $ | 34,640 | $ | 32,595 | |||||||||||||||
As a % of revenue | 14% | 15% | 12% | 12% | |||||||||||||||||||
Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Research and development | $ | 12,178 | $ | 8,529 | $ | 42,592 | $ | 36,336 | |||||||||||||||
Less: Share-based compensation expense | 2,014 | 1,095 | 6,472 | 7,453 | |||||||||||||||||||
Less: Employer payroll taxes on employee stock transactions | 6 | — | 102 | 8 | |||||||||||||||||||
Non-GAAP research and development | $ | 10,158 | $ | 7,434 | $ | 36,018 | $ | 28,875 | |||||||||||||||
As a % of revenue | 14% | 12% | 13% | 11% | |||||||||||||||||||
Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Sales and marketing | $ | 7,139 | $ | 4,305 | $ | 23,658 | $ | 18,122 | |||||||||||||||
Less: Share-based compensation expense | 631 | 95 | 2,160 | 2,247 | |||||||||||||||||||
Less: Employer payroll taxes on employee stock transactions | 2 | 2 | 40 | 11 | |||||||||||||||||||
Non-GAAP sales and marketing | $ | 6,506 | $ | 4,208 | $ | 21,458 | $ | 15,864 | |||||||||||||||
As a % of revenue | 9% | 7% | 7% | 6% | |||||||||||||||||||
Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Net cash provided by operating activities | $ | 7,352 | $ | 20,823 | $ | 74,587 | $ | 89,835 | |||||||||||||||
Less: Capitalized software | 1,905 | 1,316 | 8,228 | 4,906 | |||||||||||||||||||
Less: Capital expenditures | 247 | 151 | 1,136 | 843 | |||||||||||||||||||
Free cash flow | $ | 5,200 | $ | 19,356 | $ | 65,223 | $ | 84,086 | |||||||||||||||
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