(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS. Employer Identification No.) |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
OTC Markets Group Inc. |
(d) | Exhibits |
Exhibit No. | Description | |||||||
Perimeter Solutions, SA | ||||||||
Date: February 22, 2024 | By: | /s/ Kyle Sable | ||||||
Kyle Sable | ||||||||
Chief Financial Officer |
Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Net sales | $ | 59,455 | $ | 41,273 | $ | 322,108 | $ | 360,505 | |||||||||||||||
Cost of goods sold | 38,744 | 30,699 | 183,253 | 217,853 | |||||||||||||||||||
Gross profit | 20,711 | 10,574 | 138,855 | 142,652 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Selling, general and administrative expense | 15,550 | 19,836 | 57,073 | 74,319 | |||||||||||||||||||
Amortization expense | 13,753 | 13,710 | 55,065 | 55,105 | |||||||||||||||||||
Founders advisory fees - related party | 325 | 36,724 | (108,481) | (117,302) | |||||||||||||||||||
Intangible impairment | — | — | 40,738 | — | |||||||||||||||||||
Other operating expense | — | 60 | 10 | 465 | |||||||||||||||||||
Total operating expenses | 29,628 | 70,330 | 44,405 | 12,587 | |||||||||||||||||||
Operating (loss) income | (8,917) | (59,756) | 94,450 | 130,065 | |||||||||||||||||||
Other expense (income): | |||||||||||||||||||||||
Interest expense, net | 10,440 | 10,003 | 41,378 | 42,585 | |||||||||||||||||||
Loss (gain) on contingent earn-out | — | 336 | (7,273) | (12,706) | |||||||||||||||||||
Unrealized foreign currency (gain) loss | (2,411) | (5,279) | (1,655) | 3,462 | |||||||||||||||||||
Other expense (income), net | 388 | 317 | 417 | (503) | |||||||||||||||||||
Total other expense, net | 8,417 | 5,377 | 32,867 | 32,838 | |||||||||||||||||||
(Loss) income before income taxes | (17,334) | (65,133) | 61,583 | 97,227 | |||||||||||||||||||
Income tax benefit (expense) | 4,093 | 4,774 | 5,903 | (5,469) | |||||||||||||||||||
Net (loss) income | (13,241) | (60,359) | 67,486 | 91,758 | |||||||||||||||||||
Other comprehensive income (loss), net of tax: | |||||||||||||||||||||||
Foreign currency translation adjustments | 10,626 | 16,090 | 5,761 | (18,336) | |||||||||||||||||||
Total comprehensive (loss) income | $ | (2,615) | $ | (44,269) | $ | 73,247 | $ | 73,422 | |||||||||||||||
(Loss) earnings per share: | |||||||||||||||||||||||
Basic | $ | (0.09) | $ | (0.38) | $ | 0.44 | $ | 0.57 | |||||||||||||||
Diluted | $ | (0.09) | $ | (0.38) | $ | 0.41 | $ | 0.52 | |||||||||||||||
Weighted average number of ordinary shares outstanding: | |||||||||||||||||||||||
Basic | 150,833,523 | 157,945,813 | 154,666,717 | 160,937,575 | |||||||||||||||||||
Diluted | 150,833,523 | 157,945,813 | 166,452,022 | 175,079,941 |
December 31, 2023 | December 31, 2022 | ||||||||||
Assets | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 47,276 | $ | 126,750 | |||||||
Accounts receivable, net | 39,593 | 26,646 | |||||||||
Inventories | 145,652 | 142,961 | |||||||||
Prepaid expenses and other current assets | 18,493 | 12,165 | |||||||||
Total current assets | 251,014 | 308,522 | |||||||||
Property, plant, and equipment, net | 59,402 | 58,846 | |||||||||
Operating lease right-of-use assets | 16,339 | 18,582 | |||||||||
Finance lease right-of-use assets, net | 6,064 | — | |||||||||
Goodwill | 1,036,279 | 1,031,460 | |||||||||
Customer lists, net | 674,786 | 710,329 | |||||||||
Technology and patents, net | 180,653 | 232,818 | |||||||||
Tradenames, net | 89,568 | 94,293 | |||||||||
Other assets | 1,317 | 1,766 | |||||||||
Total assets | $ | 2,315,422 | $ | 2,456,616 | |||||||
Liabilities and Shareholders' Equity | |||||||||||
Current liabilities: | |||||||||||
Accounts payable | $ | 21,639 | $ | 36,794 | |||||||
Accrued expenses and other current liabilities | 30,710 | 32,705 | |||||||||
Founders advisory fees payable - related party | 2,702 | 4,655 | |||||||||
Total current liabilities | 55,051 | 74,154 | |||||||||
Long-term debt, net | 666,494 | 665,280 | |||||||||
Operating lease liabilities, net of current portion | 14,908 | 15,484 | |||||||||
Finance lease liabilities, net of current portion | 5,547 | — | |||||||||
Deferred income taxes | 253,454 | 278,270 | |||||||||
Founders advisory fees payable - related party | 56,917 | 170,718 | |||||||||
Redeemable preferred shares | 105,799 | 101,279 | |||||||||
Redeemable preferred shares - related party | 2,764 | 3,209 | |||||||||
Other non-current liabilities | 2,193 | 9,322 | |||||||||
Total liabilities | 1,163,127 | 1,317,716 | |||||||||
Commitments and contingencies | |||||||||||
Shareholders' equity: | |||||||||||
Ordinary shares, $1 nominal value per share; 4,000,000,000 shares authorized; 165,066,195 and 163,234,542 shares issued; 146,451,005 and 156,797,806 shares outstanding at December 31, 2023 and 2022, respectively | 165,067 | 163,235 | |||||||||
Treasury shares, at cost; 18,615,190 and 6,436,736 shares at December 31, 2023 and 2022, respectively | (113,407) | (49,341) | |||||||||
Additional paid-in capital | 1,701,163 | 1,698,781 | |||||||||
Accumulated other comprehensive loss | (19,710) | (25,471) | |||||||||
Accumulated deficit | (580,818) | (648,304) | |||||||||
Total shareholders' equity | 1,152,295 | 1,138,900 | |||||||||
Total liabilities and shareholders' equity | $ | 2,315,422 | $ | 2,456,616 |
Year Ended December 31, | |||||||||||
2023 | 2022 | ||||||||||
Cash flows from operating activities: | |||||||||||
Net income | $ | 67,486 | $ | 91,758 | |||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||||||||||
Founders advisory fees - related party (change in accounting fair value) | (108,481) | (117,302) | |||||||||
Depreciation and amortization expense | 64,855 | 65,795 | |||||||||
Interest and payment-in-kind on preferred shares | 6,792 | 6,537 | |||||||||
Share-based compensation | 1,596 | 14,649 | |||||||||
Non-cash lease expense | 5,248 | 5,390 | |||||||||
Deferred income taxes | (25,816) | (17,000) | |||||||||
Intangible impairment | 40,738 | — | |||||||||
Amortization of deferred financing costs | 1,664 | 1,602 | |||||||||
Amortization of acquisition related inventory step-up | — | 24,796 | |||||||||
Gain on contingent earn-out | (7,273) | (12,706) | |||||||||
Unrealized (gain) loss on foreign currency | (1,655) | 3,462 | |||||||||
Loss on disposal of assets | 139 | 9 | |||||||||
Changes in operating assets and liabilities, net of acquisitions: | |||||||||||
Accounts receivable | (14,435) | (6,190) | |||||||||
Inventories | (2,044) | (61,934) | |||||||||
Prepaid expenses | 1,014 | 1,922 | |||||||||
Accounts payable | (15,335) | 9,696 | |||||||||
Deferred revenue | — | (383) | |||||||||
Income taxes payable, net | (3,498) | 8,920 | |||||||||
Accrued expenses and other current liabilities | (1,758) | (647) | |||||||||
Founders advisory fees - related party (cash settled) | (4,655) | (53,547) | |||||||||
Operating lease liabilities | (4,182) | (5,072) | |||||||||
Finance lease liabilities | (282) | — | |||||||||
Other liabilities | 75 | 73 | |||||||||
Net cash provided by (used in) operating activities | 193 | (40,172) | |||||||||
Cash flows from investing activities: | |||||||||||
Purchase of property and equipment | (9,435) | (8,613) | |||||||||
Change in short-term investments | (5,459) | — | |||||||||
Purchase price adjustment under Business Combination Agreement | — | (1,638) | |||||||||
Net cash used in investing activities | (14,894) | (10,251) | |||||||||
Cash flows from financing activities: | |||||||||||
Ordinary shares repurchased | (64,066) | (49,341) | |||||||||
Proceeds from exercise of warrants | — | 529 | |||||||||
Principal payments on finance lease obligations | (387) | — | |||||||||
Net cash used in financing activities | (64,453) | (48,812) | |||||||||
Effect of foreign currency on cash and cash equivalents | (320) | 431 | |||||||||
Net change in cash and cash equivalents | (79,474) | (98,804) | |||||||||
Cash and cash equivalents, beginning of period | 126,750 | 225,554 | |||||||||
Cash and cash equivalents, end of period | $ | 47,276 | $ | 126,750 | |||||||
Supplemental disclosures of cash flow information: | |||||||||||
Cash paid for interest | $ | 37,005 | $ | 35,488 | |||||||
Cash paid for income taxes | $ | 25,960 | $ | 13,488 | |||||||
Non-cash investing and financing activities: | |||||||||||
Liability portion of founders advisory fees - related party reclassified to additional paid in capital | $ | 2,618 | $ | 19,568 |
(Unaudited) | Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(Loss) income before income taxes | $ | (17,334) | $ | (65,133) | $ | 61,583 | $ | 97,227 | |||||||||||||||
Depreciation and amortization | 16,362 | 16,259 | 64,855 | 65,795 | |||||||||||||||||||
Interest and financing expense | 10,440 | 10,003 | 41,378 | 42,585 | |||||||||||||||||||
Founders advisory fees - related party | 325 | 36,724 | (108,481) | (117,302) | |||||||||||||||||||
Intangible impairment 1 | — | — | 40,738 | — | |||||||||||||||||||
Non-recurring expenses 2 | 2,104 | 2,097 | 4,046 | 6,885 | |||||||||||||||||||
Share-based compensation expense | 1,726 | 7,098 | 1,596 | 14,649 | |||||||||||||||||||
Non-cash purchase accounting impact 3 | — | — | — | 24,796 | |||||||||||||||||||
Loss (gain) on contingent earn-out | — | 336 | (7,273) | (12,706) | |||||||||||||||||||
Unrealized foreign currency (gain) loss | (2,411) | (5,279) | (1,655) | 3,462 | |||||||||||||||||||
Adjusted EBITDA | $ | 11,212 | $ | 2,105 | $ | 96,787 | $ | 125,391 | |||||||||||||||
Net sales | $ | 59,455 | $ | 41,273 | $ | 322,108 | $ | 360,505 |
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