Business Wire | Jul 14, 2021 04:15PM EDT

E2open Announces Fiscal First Quarter 2022 Financial Results

Jul. 14, 2021

AUSTIN, Texas--(BUSINESS WIRE)--Jul. 14, 2021--E2open Parent Holdings, Inc. (NYSE: ETWO), a leading network-based provider of 100% cloud-based, mission-critical, end-to-end supply chain management software, today announced financial results for its fiscal first quarter 2022 ended May 31, 2021.

"We had a very strong start to our fiscal year 2022, with strong revenue, gross margin, and EBITDA performance as well as subscriptions bookings," said Michael Farlekas, president and chief executive officer at E2open. "We exceeded our plan on the operating metrics of revenue, gross margin, EBITDA margin, and gross and net bookings. In addition, we announced the transformational and accretive acquisition of BluJay Solutions, a strategic partnership with Dun & Bradstreet, and formed a strategic partnership with a leader in US healthcare procurement and supply chain."

"We are pleased with our strong financial results for our first quarter, and given the forward revenue visibility of the business, we remain confident that our fiscal year 2022 organic revenue growth will be 10 percent as we have projected and be in excess of 10% in that back half of this year," said Farlekas.

"In addition, we are very excited to welcome the BluJay team and clients to E2open at closing, which is anticipated to occur in the calendar year third quarter," said Farlekas.

Fiscal First Quarter 2022 Financial Highlights

NOTE: Non-GAAP revenue adds back amortization of the fair value adjustment to deferred revenue resulting from the business combination with CC Neuberger Principal Holdings I (CCNB1) as required by GAAP. The Company is adding this back to provide better comparability in the calculation of our organic growth rate.

* Revenue: Total GAAP revenue for fiscal first quarter 2022 reached $66.3 million, a decrease of 20.2% from $83.1 million in the fiscal first quarter of 2021. Total non-GAAP revenue was $88.8 million, an increase of 6.9% compared to $83.1 million in the fiscal first quarter of 2021. Subscription revenue for the fiscal first quarter of 2022 was $51.0 million compared to $69.6 million in the prior year period. Fiscal first quarter 2022 non-GAAP subscription revenue was up 5.6% to $73.5 million compared to $69.6 million from the prior fiscal first quarter.

* Gross Profit: Gross profit for the fiscal first quarter of 2022 was $28.2 million, a decrease of 46.2% compared with $52.3 million in the same quarter of 2021. Non-GAAP gross profit for the fiscal first quarter of 2022 was $65.4 million, an increase of 10.2% compared to $59.4 million in the prior year's first quarter.

* Gross Margin: Gross margin was 42.5% versus 63.0% in the fiscal first quarter of 2022 versus 2021, respectively. Non-GAAP gross margin was 73.7% versus 71.4% when compared to fiscal first quarter of 2021.

* EBITDA: EBITDA for the fiscal first quarter of 2022 was a loss of $141.6 million compared with $20.2 million in the same quarter of 2021. Adjusted EBITDA was $29.2 million with a margin of 32.9%, an increase from $27.0 million in the fiscal first quarter 2021 with a margin of 32.4%.

* Net Loss: Net loss for the fiscal first quarter of 2022 was $169.4 million compared with a net loss of $23.8 million in the same quarter of 2021.

* Cash flow and Net debt: Net cash provided by operating activities was $39.3 million for the first quarter of fiscal 2022, compared to cash provided by operating activities of $29.8 million in the prior year period. Net debt as of May 31, 2021, as defined in the non-GAAP reconciliation Table II, was $296.4 million. E2open's net debt forward leverage ratio is approximately 2.4 times adjusted EBITDA as of May 31, 2021 based on projected 2022 adjusted EBITDA.

Variance

(in millions) Successor Predecessor % Q1 2022 Q1 2021



Subscription Revenue $51.0 $69.6 (26.7)%

Business Combination Adjustment (a) 22.5 - -

Non-GAAP Subscription Revenue 73.5 69.6 5.6%

Professional Services Revenue 15.3 13.5 13.3%

Non-GAAP Revenue $88.8 $83.1 6.9%



Gross Profit $28.2 $52.3 (46.2)%

Gross Profit Margin 42.5% 63.0%

Non-GAAP Gross Profit $65.4 $59.4 10.2%

Non-GAAP Gross Profit Margin (b) 73.7% 71.4%



Adjusted EBITDA $29.2 $27.0 8.3%

Adjusted EBITDA Margin (c) 32.9% 32.4%

Footnotes (see reconciliation table for GAAP to non-GAAP metrics)

(a)

Amortization of the fair value adjustment to deferred revenue related to the purchase price allocation in the CCNB1 combination.

(b)

Calculated utilizing non-GAAP gross profit as a percentage of non-GAAP revenue.

(c)

Calculated utilizing adjusted EBITDA as a percentage of non-GAAP revenue.

Recent Business Highlights

* E2open recently announced the acquisition of BluJay Solutions, a leading cloud-based, logistics execution platform, which is anticipated to close during the third calendar quarter of 2021. The combination will provide more robust capabilities in the areas of global trade and transportation management driving value to our customers while accelerating our long-term growth.

* As a component of E2open's growth levers, the Company has entered into strategic partnership agreements with Dun & Bradstreet and a leader in healthcare procurement and supply chain. These agreements will leverage each company's unique capabilities and utilize E2open's platform and network to expand the Company's market reach.

* E2open announced a large new logo win with Tesco, the leading UK retailer, representing a significant start to a strategic relationship with Tesco.

* E2open's new account logo sales team continues to augment our current go to market strategy focused on our existing client base. The combination with BluJay Solutions will strengthen the cross-sell, upsell opportunity and significantly accelerate our new logo sales initiative.

Financial Outlook for Fiscal Year 2022

As of July 14, 2021, E2open is reaffirming its guidance for its full fiscal year 2022, which ends February 28, 2022, as follows:

* Total non-GAAP revenue is expected to be in the range of $369 million to $371 million. * Non-GAAP gross profit is expected to be in the range of $268 million to $270 million. * Adjusted EBITDA is expected to be in the range of $120 million to $122 million. * These estimates reflect approximately 10% organic revenue growth and an adjusted gross margin in the range of 72 to 73%.

Quarterly Conference Call

E2open will host a video webinar today at 5:00 p.m. ET to discuss fiscal first quarter 2022 financial results, in addition to discussing the Company's outlook for the full fiscal year 2022. The video webinar will be available live on the Investor Relations section of the Company's website at www.e2open.com. A replay will be available within 12 hours after the conclusion of the live event.

About E2open

At E2open, we're creating a more connected, intelligent supply chain. It starts with sensing and responding to real-time demand, supply and delivery constraints. Bringing together data from clients, distribution channels, suppliers, contract manufacturers and logistics partners, our collaborative and agile supply chain platform enables companies to use data in real time, with artificial intelligence and machine learning to drive smarter decisions. All this complex information is delivered in a single view that encompasses your demand, supply and logistics ecosystems. E2open is changing everything. Demand. Supply. Delivered.TMVisit www.e2open.com.

E2open and the E2open logo are registered trademarks of E2open, LLC. Demand. Supply. Delivered. is a trademark of E2open, LLC.

Non-GAAP Financial Measures

This press release includes certain financial measures not presented in accordance with generally accepted accounting principles ("GAAP") including non-GAAP revenue, non-GAAP subscription revenue, adjusted EBITDA, adjusted EBITDA margin, non-GAAP gross profit, non-GAAP net income, net debt, and non-GAAP gross margin. These non-GAAP financial measures are not a measure of financial performance in accordance with GAAP and may exclude items that are significant in understanding and assessing the Company's financial results. Therefore, these measures should not be considered in isolation or as an alternative to net income, cash flows from operations or other measures of profitability, liquidity, or performance under GAAP. You should be aware that the Company's presentation of these measures may not be comparable to similarly titled measures used by other companies.

The Company believes this non-GAAP measure of financial results provides 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 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 in comparing the Company's financial measures with other similar companies, many of which present similar non-GAAP financial measures to investors. These non-GAAP financial measures are subject to inherent limitations as they reflect the exercise of judgments by management about which expense and income are excluded or included in determining these non-GAAP financial measures.

Safe Harbor Statement

Certain statements in this press release are "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created thereby. These statements relate to future events or the Company's future financial performance and involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the Company or its industry to be materially different from those expressed or implied by any forward-looking statements. In particular, statements about the Company's expectations, beliefs, plans, objectives, assumptions, future events or future performance contained in this press release are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as "may," "will," "could," "would," "should," "expect," "plan," "anticipate," "intend," "believe," "estimate," "predict," "potential," "outlook," "guidance" or the negative of those terms or other comparable terminology.

Please see the Company's documents filed or to be filed with the Securities and Exchange Commission, including the annual report filed on Form 10-K, and any amendments thereto for a discussion of certain important risk factors that relate to forward-looking statements contained in this press release. The Company has based these forward-looking statements on its current expectations, assumptions, estimates and projections. While the Company believes these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond the Company's control. These and other important factors may cause actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Any forward-looking statements are made only as of the date hereof, and unless otherwise required by applicable securities laws, the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Footnotes (see reconciliation table for GAAP to non-GAAP metrics)

(a) Amortization of the fair value adjustment to deferred revenue related to the purchase price allocation in the CCNB1 combination.

(b) Calculated utilizing non-GAAP gross profit as a percentage of non-GAAP revenue.

(c) Calculated utilizing adjusted EBITDA as a percentage of non-GAAP revenue.



Recent Business Highlights

* E2open recently announced the acquisition of BluJay Solutions, a leading cloud-based, logistics execution platform, which is anticipated to close during the third calendar quarter of 2021. The combination will provide more robust capabilities in the areas of global trade and transportation management driving value to our customers while accelerating our long-term growth.

* As a component of E2open's growth levers, the Company has entered into strategic partnership agreements with Dun & Bradstreet and a leader in healthcare procurement and supply chain. These agreements will leverage each company's unique capabilities and utilize E2open's platform and network to expand the Company's market reach.

* E2open announced a large new logo win with Tesco, the leading UK retailer, representing a significant start to a strategic relationship with Tesco.

* E2open's new account logo sales team continues to augment our current go to market strategy focused on our existing client base. The combination with BluJay Solutions will strengthen the cross-sell, upsell opportunity and significantly accelerate our new logo sales initiative.

Financial Outlook for Fiscal Year 2022

As of July 14, 2021, E2open is reaffirming its guidance for its full fiscal year 2022, which ends February 28, 2022, as follows:

* Total non-GAAP revenue is expected to be in the range of $369 million to $371 million. * Non-GAAP gross profit is expected to be in the range of $268 million to $270 million. * Adjusted EBITDA is expected to be in the range of $120 million to $122 million. * These estimates reflect approximately 10% organic revenue growth and an adjusted gross margin in the range of 72 to 73%.

Quarterly Conference Call

E2open will host a video webinar today at 5:00 p.m. ET to discuss fiscal first quarter 2022 financial results, in addition to discussing the Company's outlook for the full fiscal year 2022. The video webinar will be available live on the Investor Relations section of the Company's website at www.e2open.com. A replay will be available within 12 hours after the conclusion of the live event.

About E2open

At E2open, we're creating a more connected, intelligent supply chain. It starts with sensing and responding to real-time demand, supply and delivery constraints. Bringing together data from clients, distribution channels, suppliers, contract manufacturers and logistics partners, our collaborative and agile supply chain platform enables companies to use data in real time, with artificial intelligence and machine learning to drive smarter decisions. All this complex information is delivered in a single view that encompasses your demand, supply and logistics ecosystems. E2open is changing everything. Demand. Supply. Delivered.TMVisit www.e2open.com.

E2open and the E2open logo are registered trademarks of E2open, LLC. Demand. Supply. Delivered. is a trademark of E2open, LLC.

Non-GAAP Financial Measures

This press release includes certain financial measures not presented in accordance with generally accepted accounting principles ("GAAP") including non-GAAP revenue, non-GAAP subscription revenue, adjusted EBITDA, adjusted EBITDA margin, non-GAAP gross profit, non-GAAP net income, net debt, and non-GAAP gross margin. These non-GAAP financial measures are not a measure of financial performance in accordance with GAAP and may exclude items that are significant in understanding and assessing the Company's financial results. Therefore, these measures should not be considered in isolation or as an alternative to net income, cash flows from operations or other measures of profitability, liquidity, or performance under GAAP. You should be aware that the Company's presentation of these measures may not be comparable to similarly titled measures used by other companies.

The Company believes this non-GAAP measure of financial results provides 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 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 in comparing the Company's financial measures with other similar companies, many of which present similar non-GAAP financial measures to investors. These non-GAAP financial measures are subject to inherent limitations as they reflect the exercise of judgments by management about which expense and income are excluded or included in determining these non-GAAP financial measures.

Safe Harbor Statement

Certain statements in this press release are "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created thereby. These statements relate to future events or the Company's future financial performance and involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the Company or its industry to be materially different from those expressed or implied by any forward-looking statements. In particular, statements about the Company's expectations, beliefs, plans, objectives, assumptions, future events or future performance contained in this press release are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as "may," "will," "could," "would," "should," "expect," "plan," "anticipate," "intend," "believe," "estimate," "predict," "potential," "outlook," "guidance" or the negative of those terms or other comparable terminology.

Please see the Company's documents filed or to be filed with the Securities and Exchange Commission, including the annual report filed on Form 10-K, and any amendments thereto for a discussion of certain important risk factors that relate to forward-looking statements contained in this press release. The Company has based these forward-looking statements on its current expectations, assumptions, estimates and projections. While the Company believes these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond the Company's control. These and other important factors may cause actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Any forward-looking statements are made only as of the date hereof, and unless otherwise required by applicable securities laws, the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

E2OPEN PARENT HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

Successor Predecessor

Three Months Three Months Ended Ended

May 31, 2021 May 31, 2020

Revenue

Subscriptions $ 51,034 $ 69,604

Professional services 15,293 13,520

Total revenue 66,327 83,124

Cost of Revenue

Subscriptions 16,508 14,138

Professional services 10,140 11,095

Amortization of acquired intangible assets 11,511 5,561

Total cost of revenue 38,159 30,794

Gross Profit 28,168 52,330

Operating Expenses

Research and development 15,701 14,631

Sales and marketing 12,514 12,310

General and administrative 13,717 9,764

Acquisition-related expenses 9,778 3,368

Amortization of acquired intangible assets 3,830 8,467

Total operating expenses 55,540 48,540

(Loss) income from operations (27,372 ) 3,790

Other (expense) income

Interest and other expense, net (4,903 ) (19,372 )

Change in tax receivable agreement (2,499 ) - liability

Loss from change in fair value of warrant (59,943 ) - liability

Loss from change in fair value of (73,260 ) - contingent consideration

Total other expenses (140,605 ) (19,372 )

Loss before income tax benefit (167,977 ) (15,582 )

Income tax expense (1,378 ) (8,170 )

Net loss (169,355 ) $ (23,752 )

Less: Net loss attributable to (27,097 ) noncontrolling interest

Net loss attributable to E2open Parent $ (142,258 ) Holdings, Inc.



Net loss attributable to E2open ParentHoldings, Inc.

common shareholders per share:

Basic $ (0.76 )

Diluted $ (0.76 )

E2OPEN PARENT HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

Successor

(In thousands, except share amounts)

May 31, 2021

February 28, 2021

(unaudited)

Assets

Cash and cash equivalents

$

220,748

$

194,717

Restricted cash

11,815

12,825

Accounts receivable - net of allowance of $514 and $908, respectively

60,641

112,657

Prepaid expenses and other current assets

12,091

12,643

Total current assets

305,295

332,842

Long-term investments

226

224

Goodwill

2,630,941

2,628,646

Intangible assets, net

809,875

824,851

Property and equipment, net

47,045

44,198

Operating lease right-of-use assets

21,048

-

Other noncurrent assets

8,654

7,416

Total assets

$

3,823,084

$

3,838,177

Liabilities and Stockholders' Equity

Accounts payable and accrued liabilities

$

56,163

$

70,233

Incentive program payable

11,815

12,825

Deferred revenue

98,299

89,691

Acquisition-related obligations

2,000

2,000

Current portion of notes payable

4,110

4,405

Current portion of operating lease obligations

5,064

-

Current portion of financing lease obligations

3,961

4,827

Total current liabilities

181,412

183,981

Long-term deferred revenue

1,484

482

Operating lease obligations

16,551

-

Financing lease obligations

5,691

6,588

Notes payable

503,266

502,800

Tax receivable agreement liability

52,614

50,114

Warrant liability

128,715

68,772

Contingent consideration

224,068

150,808

Deferred taxes

396,735

396,217

Other noncurrent liabilities

1,027

1,057

Total liabilities

1,511,563

1,360,819

Stockholders' Equity

Class A common stock (Successor); $0.0001 par value, 2,500,000,000 shares authorized; 187,051,142 issued and outstanding as of May 31, 2021 and February 28, 2021

19

19

Class V common stock (Successor); $0.0001 par value; 40,000,000 shares authorized; 35,636,680 issued and outstanding as of May 31, 2021 and February 28, 2021

-

-

Series B-1 common stock (Successor); $0.0001 par value; 9,000,000 shares authorized; 8,120,367 issued and outstanding as of May 31, 2021 and February 28, 2021

-

-

Series B-2 common stock (Successor); $0.0001 par value; 4,000,000 shares authorized; 3,372,184 issued and outstanding as of May 31, 2021 and February 28, 2021

-

-

Additional paid-in capital

2,073,249

2,071,206

Accumulated other comprehensive income

3,863

2,388

(Accumulated deficit) retained earnings

(131,458

)

10,800

Total E2open Parent Holdings, Inc. equity

1,945,673

2,084,413

Noncontrolling interest

365,848

392,945

Total stockholders' equity

2,311,521

2,477,358

Total liabilities and stockholders' equity

$

3,823,084

$

3,838,177

E2OPEN PARENT HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

Successor

(In thousands, except share amounts) May 31, February 2021 28, 2021

(unaudited)

Assets

Cash and cash equivalents $ 220,748 $ 194,717

Restricted cash 11,815 12,825

Accounts receivable - net of allowance of $514 60,641 112,657 and $908, respectively

Prepaid expenses and other current assets 12,091 12,643

Total current assets 305,295 332,842

Long-term investments 226 224

Goodwill 2,630,941 2,628,646

Intangible assets, net 809,875 824,851

Property and equipment, net 47,045 44,198

Operating lease right-of-use assets 21,048 -

Other noncurrent assets 8,654 7,416

Total assets $ 3,823,084 $ 3,838,177

Liabilities and Stockholders' Equity

Accounts payable and accrued liabilities $ 56,163 $ 70,233

Incentive program payable 11,815 12,825

Deferred revenue 98,299 89,691

Acquisition-related obligations 2,000 2,000

Current portion of notes payable 4,110 4,405

Current portion of operating lease obligations 5,064 -

Current portion of financing lease obligations 3,961 4,827

Total current liabilities 181,412 183,981

Long-term deferred revenue 1,484 482

Operating lease obligations 16,551 -

Financing lease obligations 5,691 6,588

Notes payable 503,266 502,800

Tax receivable agreement liability 52,614 50,114

Warrant liability 128,715 68,772

Contingent consideration 224,068 150,808

Deferred taxes 396,735 396,217

Other noncurrent liabilities 1,027 1,057

Total liabilities 1,511,563 1,360,819

Stockholders' Equity

Class A common stock (Successor); $0.0001 parvalue, 2,500,000,000 shares authorized; 19 19 187,051,142 issued and outstanding as of May31, 2021 and February 28, 2021

Class V common stock (Successor); $0.0001 parvalue; 40,000,000 shares authorized; 35,636,680 - - issued and outstanding as of May 31, 2021 andFebruary 28, 2021

Series B-1 common stock (Successor); $0.0001par value; 9,000,000 shares authorized; - - 8,120,367 issued and outstanding as of May 31,2021 and February 28, 2021

Series B-2 common stock (Successor); $0.0001par value; 4,000,000 shares authorized; - - 3,372,184 issued and outstanding as of May 31,2021 and February 28, 2021

Additional paid-in capital 2,073,249 2,071,206

Accumulated other comprehensive income 3,863 2,388

(Accumulated deficit) retained earnings (131,458 ) 10,800

Total E2open Parent Holdings, Inc. equity 1,945,673 2,084,413

Noncontrolling interest 365,848 392,945

Total stockholders' equity 2,311,521 2,477,358

Total liabilities and stockholders' equity $ 3,823,084 $ 3,838,177

E2OPEN PARENT HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

Successor

Predecessor

Three Months Ended

Three Months Ended

(In thousands)

May 31, 2021

May 31, 2020

Cash flows from operating activities

Net loss

$

(169,355

)

$

(23,752

)

Adjustments to reconcile net loss to net cash from operating activities:

Depreciation and amortization

20,205

16,978

Amortization of deferred commissions

158

987

Amortization of debt issuance costs

667

1,079

Amortization of operating lease right-of-use assets

1,372

-

Share-based and unit-based compensation

2,043

2,046

Change in tax receivable agreement liability

2,499

-

Loss from change in fair value of warrant liability

59,943

-

Loss from change in fair value of contingent consideration

73,260

-

(Gain) loss on disposal of property and equipment

(187

)

32

Changes in operating assets and liabilities:

Accounts receivable, net

52,016

62,606

Prepaid expenses and other current assets

552

(167

)

Other noncurrent assets

(1,399

)

(183

)

Accounts payable and accrued liabilities

(9,234

)

(8,387

)

Incentive program payable

(1,010

)

(8,679

)

Deferred revenue

9,611

(21,234

)

Changes in other liabilities

(1,875

)

8,505

Net cash provided by operating activities

39,266

29,831

Cash flows from investing activities

Capital expenditures

(12,385

)

(3,886

)

Net cash used in investing activities

(12,385

)

(3,886

)

Cash flows from financing activities

Proceeds from sale of membership units

-

1,788

Proceeds from indebtedness

-

284

Repayments of indebtedness

(153

)

(2,253

)

Repayments of financing lease obligations

(546

)

(421

)

Net cash used in financing activities

(699

)

(602

)

Effect of exchange rate changes on cash and cash equivalents

(1,161

)

120

Net increase in cash, cash equivalents and restricted cash

25,021

25,463

Cash, cash equivalents and restricted cash at beginning of period

207,542

48,428

Cash, cash equivalents and restricted cash at end of period

$

232,563

$

73,891

Reconciliation of cash, cash equivalents and restricted cash:

Cash and cash equivalents

$

220,748

$

53,637

Restricted cash

11,815

20,254

Total cash, cash equivalents and restricted cash

$

232,563

$

73,891

Supplemental Information - Cash Paid for:

Interest

$

5,192

$

17,408

Income taxes

462

333

Non-Cash Investing and Financing Activities:

Capital expenditures financed under financing lease obligations

$

-

$

2,643

Capital expenditures included in accounts payable and accrued liabilities

1,933

78

Right-of-use assets obtained in exchange for operating lease obligations

22,420

-

E2OPEN PARENT HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

Successor Predecessor

Three Three Months Months Ended Ended

(In thousands) May 31, May 31, 2021 2020

Cash flows from operating activities

Net loss $ (169,355 ) $ (23,752 )

Adjustments to reconcile net loss to net cash from operating activities:

Depreciation and amortization 20,205 16,978

Amortization of deferred commissions 158 987

Amortization of debt issuance costs 667 1,079

Amortization of operating lease right-of-use 1,372 - assets

Share-based and unit-based compensation 2,043 2,046

Change in tax receivable agreement liability 2,499 -

Loss from change in fair value of warrant 59,943 - liability

Loss from change in fair value of contingent 73,260 - consideration

(Gain) loss on disposal of property and (187 ) 32 equipment

Changes in operating assets and liabilities:

Accounts receivable, net 52,016 62,606

Prepaid expenses and other current assets 552 (167 )

Other noncurrent assets (1,399 ) (183 )

Accounts payable and accrued liabilities (9,234 ) (8,387 )

Incentive program payable (1,010 ) (8,679 )

Deferred revenue 9,611 (21,234 )

Changes in other liabilities (1,875 ) 8,505

Net cash provided by operating activities 39,266 29,831

Cash flows from investing activities

Capital expenditures (12,385 ) (3,886 )

Net cash used in investing activities (12,385 ) (3,886 )

Cash flows from financing activities

Proceeds from sale of membership units - 1,788

Proceeds from indebtedness - 284

Repayments of indebtedness (153 ) (2,253 )

Repayments of financing lease obligations (546 ) (421 )

Net cash used in financing activities (699 ) (602 )

Effect of exchange rate changes on cash and (1,161 ) 120 cash equivalents

Net increase in cash, cash equivalents and 25,021 25,463 restricted cash

Cash, cash equivalents and restricted cash at 207,542 48,428 beginning of period

Cash, cash equivalents and restricted cash at $ 232,563 $ 73,891 end of period

Reconciliation of cash, cash equivalents and restricted cash:

Cash and cash equivalents $ 220,748 $ 53,637

Restricted cash 11,815 20,254

Total cash, cash equivalents and restricted $ 232,563 $ 73,891 cash

Supplemental Information - Cash Paid for:

Interest $ 5,192 $ 17,408

Income taxes 462 333

Non-Cash Investing and Financing Activities:

Capital expenditures financed under financing $ - $ 2,643 lease obligations

Capital expenditures included in accounts 1,933 78 payable and accrued liabilities

Right-of-use assets obtained in exchange for 22,420 - operating lease obligations

E2OPEN PARENT HOLDINGS, INC.

RECONCILIATION OF NON-GAAP INFORMATION TABLE I

($ in millions)

(unaudited)

Successor

Predecessor

Three Months Ended May 31, 2021

Three Months Ended May 31, 2020

Subscriptions

$

51.0

$

69.6

Professional services

15.3

13.5

Revenue

66.3

83.1

Business combination adjustment (a)

22.5

-

Non-GAAP Revenue

88.8

83.1

Gross Profit

28.2

52.3

Adjustments

Business Combination Adjustment (a)

22.5

-

Depreciation expenses

2.6

1.2

Amortization of intangible assets

11.5

5.6

Share - based compensation (b)

0.3

0.2

Non-recurring/non-operating costs (c)

0.3

0.1

Non-GAAP Gross Profit

65.4

59.4

Gross profit margin

42.5

%

63.0

%

Non-GAAP Gross profit margin(d)

73.7

%

71.4

%

EBITDA

(141.6

)

20.2

Adjustments

Business Combination adjustment (a)

22.5

-

Change in fair value of financial instruments (e)

133.2

-

Change in tax receivable agreement (f)

2.5

-

Acquisition-related adjustments (g)

9.8

3.4

Non-recurring/non-operating costs (c)

0.4

1.1

Share - based compensation (b)

2.4

2.3

Adjusted EBITDA

29.2

27.0

EBITDA Margin

-213.5

%

24.3

%

Adjusted EBITDA Margin(h)

32.9

%

32.4

%

E2OPEN PARENT HOLDINGS, INC.

RECONCILIATION OF NON-GAAP INFORMATION TABLE I

($ in millions)

(unaudited)

Successor Predecessor

Three Three Months Months Ended Ended May 31, 2021 May 31, 2020

Subscriptions $ 51.0 $ 69.6

Professional services 15.3 13.5

Revenue 66.3 83.1

Business combination adjustment (a) 22.5 -

Non-GAAP Revenue 88.8 83.1

Gross Profit 28.2 52.3

Adjustments

Business Combination Adjustment (a) 22.5 -

Depreciation expenses 2.6 1.2

Amortization of intangible assets 11.5 5.6

Share - based compensation (b) 0.3 0.2

Non-recurring/non-operating costs (c) 0.3 0.1

Non-GAAP Gross Profit 65.4 59.4

Gross profit margin 42.5 % 63.0 %

Non-GAAP Gross profit margin (d) 73.7 % 71.4 %

EBITDA (141.6 ) 20.2

Adjustments

Business Combination adjustment (a) 22.5 -

Change in fair value of financial instruments (e) 133.2 -

Change in tax receivable agreement (f) 2.5 -

Acquisition-related adjustments (g) 9.8 3.4

Non-recurring/non-operating costs (c) 0.4 1.1

Share - based compensation (b) 2.4 2.3

Adjusted EBITDA 29.2 27.0

EBITDA Margin -213.5 % 24.3 %

Adjusted EBITDA Margin (h) 32.9 % 32.4 %

Footnotes

(a)

Amortization of the fair value adjustment to deferred revenue related to the purchase price allocation in the CCNB1 combination.

(b)

Reflects non-cash, long-term unit-based compensation expense, primarily related to senior management.

(c)

Primarily includes foreign currency exchange gain and losses and other non-recurring expenses such as systems integrations, legal entity simplification, advisory fees and expenses related to retention of key employees from acquisitions.

(d)

Calculated utilizing non-GAAP gross profit as a percentage of non-GAAP revenue.

(e)

Represents the fair value adjustment at each balance sheet date of the warrant liability related to the public, private placement and forward purchase warrants and the fair value adjustment at each balance sheet date of the contingent consideration liability related to the restricted Series B-1 and B-2 common stock and Sponsor Side Letter.

(f)

Represents the expense related to the change in the fair value of the tax receivable agreement liability, including interest.

(g)

Primarily includes advisory, consulting, accounting and legal expenses incurred in connection with mergers and acquisitions activities, including related valuation, negotiation and integration costs and capital-raising activities, including costs related to the acquisition of Amber Road, Inc., the Business Combination and the pending acquisition of BluJay.

(h)

Calculated utilizing adjusted EBITDA as a percentage of non-GAAP revenue.

Footnotes



(a) Amortization of the fair value adjustment to deferred revenue related to the purchase price allocation in the CCNB1 combination.



(b) Reflects non-cash, long-term unit-based compensation expense, primarily related to senior management.



Primarily includes foreign currency exchange gain and losses and other(c) non-recurring expenses such as systems integrations, legal entity simplification, advisory fees and expenses related to retention of key employees from acquisitions.

(d) Calculated utilizing non-GAAP gross profit as a percentage of non-GAAP revenue.

Represents the fair value adjustment at each balance sheet date of the warrant liability related to the public, private placement and forward(e) purchase warrants and the fair value adjustment at each balance sheet date of the contingent consideration liability related to the restricted Series B-1 and B-2 common stock and Sponsor Side Letter.

(f) Represents the expense related to the change in the fair value of the tax receivable agreement liability, including interest.

Primarily includes advisory, consulting, accounting and legal expenses incurred in connection with mergers and acquisitions activities,(g) including related valuation, negotiation and integration costs and capital-raising activities, including costs related to the acquisition of Amber Road, Inc., the Business Combination and the pending acquisition of BluJay.

(h) Calculated utilizing adjusted EBITDA as a percentage of non-GAAP revenue.

E2OPEN PARENT HOLDINGS, INC.

RECONCILIATION OF NON-GAAP INFORMATION TABLE II

(in millions)

As of May 31, 2021

(unaudited)

Current portion of notes payable and capital lease obligations

$8.1

Notes payable and financing lease obligations

$509.0

Adjusted for:

Cash and cash equivalents

$220.7

Net Debt as of Feb. 28, 2021

$296.4

Projected FY22 adjusted EBITDA

$120 - 122

Net Debt Forward Leverage Ratio (non-GAAP)

~2.4x

View source version on businesswire.com: https://www.businesswire.com/news/home/20210714005850/en/

CONTACT: Investor Contact J. Adam Rogers E2open adam.rogers@e2open.com 515-556-1162

CONTACT: Media Contact WE Communications for E2open e2open@we-worldwide.com 512-527-7029