Covetrus Announces Financial Results for Third Quarter of 2019
- GAAP net sales of
$1.0 billion , an increase of 10% year-over-year; non-GAAP pro forma organic net sales increased 5% year-over-year
- Net loss of
$906 million , including a non-cash goodwill impairment charge of$939 million ; non-GAAP adjusted net income of$19 million , a decline of 10% year-over-year on a pro forma basis
- Non-GAAP adjusted EBITDA of
$49 million , a decline of 4% year-over-year on a pro forma basis
- Non-GAAP 2019 pro forma adjusted EBITDA expected to be in a range of
$190 million to $196 million
"Our team is unified in our belief in the
Summary Operating Results (Unaudited)
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(In millions, except per share data) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Net sales | $ | 1,018 | $ | 923 | $ | 2,968 | $ | 2,875 | |||||||
(Loss) income before taxes | $ | (969 | ) | $ | 35 | $ | (992 | ) | $ | 107 | |||||
Net (loss) income attributable to Covetrus | $ | (906 | ) | $ | 16 | $ | (929 | ) | $ | 67 | |||||
Diluted (loss) earnings per share (EPS) | $ | (8.09 | ) | $ | 0.22 | $ | (8.76 | ) | $ | 0.94 | |||||
Non-GAAP Measures: (a) | |||||||||||||||
Pro forma net sales | $ | 1,018 | $ | 976 | $ | 2,992 | $ | 3,024 | |||||||
Pro forma organic net sales growth | 5 | % | n/a | 2 | % | n/a | |||||||||
Pro forma adjusted EBITDA | $ | 49 | $ | 51 | $ | 153 | $ | 165 | |||||||
Pro forma adjusted net income | $ | 19 | $ | 21 | $ | 63 | $ | 73 |
(a) Non-GAAP financial measures should be considered in addition to, but not as a substitute for, the information provided in accordance with GAAP. Reconciliations for non-GAAP financial items to the most directly comparable GAAP financial items are provided under Reconciliation of Non-GAAP Financial Measures at the end of this release.
On
To aid investors and analysts with year-over-year comparability for the combined businesses of
Net sales for the third quarter of 2019 were
Non-GAAP pro forma organic net sales increased 5% year-over-year. Pro forma organic net sales growth includes a full quarter of Vets First Choice in both periods, excludes the impact of foreign exchange fluctuations and M&A and normalizes for net sales adjustments for manufacturer switches from direct to agency sales in
In
Net loss in the third quarter of 2019 was
Non-GAAP adjusted EBITDA was
Non-GAAP adjusted net income was
Segment Operating Results (Unaudited)
The company’s operations are organized and reported by geography, including
APAC & Emerging Markets segment net sales of
Balance Sheet and Cash Flow
At quarter end, the company had
2019 Guidance
Covetrus’ fiscal year 2019 financial guidance range is as follows:
- Pro forma organic net sales growth, a non-GAAP financial metric, expected to be low single-digits and is unchanged from the company's prior outlook; and
- Pro forma adjusted EBITDA, a non-GAAP financial metric, expected to be in a range of
$190 to $196 million versus the company's prior outlook of at least$200 million .
“While our third quarter results demonstrated more stability in our business, they failed to live up to expectations and so we are taking action across our organization to drive greater focus and accountability," said
The Company has not reconciled its non-GAAP pro forma adjusted EBITDA guidance to GAAP net income because the reconciling items between such GAAP and non-GAAP financial measures, including share-based compensation expense, restructuring costs and other special items tied to the formation of
Conference Call
The Company will host a conference call to discuss these results and 2019 guidance at
Benjamin Wolin , acting president and chief executive officerChristine T. Komola , executive vice president and chief financial officer
To access the live webcast of the conference call, individuals can visit the Investor Relations page of the
The conference call can also be accessed by dialing 866-789-2492 for U.S./
Audio webcasts will be available live and archived on the company’s Investor Relations website at https://ir.covetrus.com/investors/events-and-presentations. A complete listing of upcoming events for the investment community is available on the company’s Investor Relations website.
About
Covetrus is a global animal-health technology and services company dedicated to empowering veterinary practice partners to drive improved health and financial outcomes. We are bringing together products, services, and technology into a single platform that connects our customers to the solutions and insights they need to work best. Our passion for the well-being of animals and those who care for them drives us to advance the world of veterinary medicine. Covetrus is headquartered in Portland, Maine with more than 5,500 employees serving over 100,000 customers around the globe. For more information about Covetrus visit https://www.covetrus.com/.
Forward-Looking Statements
This press release contains certain statements that are forward-looking within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and that involve risks and uncertainties, including statements about our future financial and operating results including 2019 guidance, plans, our value proposition, our objectives, expenses, expectations, trends and potential growth in our business, expected practices on our platform, intentions, our liquidity, product development and improvements, and other matters. We may, in some cases use terms such as "predicts," "believes," "potential," "continue," "anticipates," "estimates," "expects," "plans," "intends," "may," "could," "might," "likely," "will," "should" or other words that convey uncertainty of the future events or outcomes to identify these forward-looking statements. Such statements are subject to numerous risks and uncertainties, including but not limited to, risks associated with our management transition; the ability to successfully integrate operations and employees; the ability to realize anticipated benefits and synergies of the transactions that created
CONSOLIDATED BALANCE SHEET AS OF
COMBINED BALANCE SHEET AS OF
(In millions, except share amounts)
September 30, 2019 |
December 29, 2018 |
||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 68 | $ | 23 | |||
Accounts receivable, net of allowance of $7 and $7 | 466 | 431 | |||||
Inventory, net | 598 | 564 | |||||
Other receivables | 77 | 49 | |||||
Prepaid expenses and other | 35 | 19 | |||||
Total current assets | 1,244 | 1,086 | |||||
Non-current assets: | |||||||
Property and equipment, net of accumulated depreciation of $90 and $74 | 104 | 69 | |||||
Operating lease right-of-use assets | 75 | — | |||||
Goodwill | 1,156 | 750 | |||||
Other intangibles, net of accumulated amortization of $328 and $241 | 679 | 208 | |||||
Investments and other | 70 | 120 | |||||
Total assets | $ | 3,328 | $ | 2,233 | |||
LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS, AND SHAREHOLDERS' EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 483 | $ | 441 | |||
Current maturities of long-term debt and other borrowings | 47 | 1 | |||||
Accrued expenses: | |||||||
Payroll and related | 51 | 37 | |||||
Taxes | 26 | 17 | |||||
Other | 144 | 77 | |||||
Total current liabilities | 751 | 573 | |||||
Non-current liabilities: | |||||||
Long-term debt and other borrowings, net | 1,141 | 24 | |||||
Deferred taxes | 11 | 16 | |||||
Other liabilities | 86 | 35 | |||||
Total liabilities | 1,989 | 648 | |||||
Commitments and contingencies | |||||||
Redeemable non-controlling interests | 10 | 92 | |||||
Shareholders' equity: | |||||||
Common stock, $0.01 par value per share, 675,000,000 shares authorized as of September 30, 2019; 112,054,273 shares issued and outstanding as of September 30, 2019 | 1 | — | |||||
Net parent investment | — | 1,576 | |||||
Accumulated other comprehensive loss | (102 | ) | (83 | ) | |||
Additional paid-in capital | 2,369 | — | |||||
Accumulated deficit | (939 | ) | — | ||||
Total shareholders’ equity | 1,329 | 1,493 | |||||
Total liabilities, redeemable non-controlling interests, and shareholders’ equity | $ | 3,328 | $ | 2,233 |
CONSOLIDATED STATEMENT OF OPERATIONS FOR
COMBINED STATEMENT OF OPERATIONS FOR
(In millions, except per share data) (Unaudited)
Three Months Ended September 30, |
Nine Months Ended September 30, |
||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net sales | $ | 1,018 | $ | 923 | $ | 2,968 | $ | 2,875 | |||||||
Cost of sales | 821 | 757 | 2,391 | 2,350 | |||||||||||
Gross profit | 197 | 166 | 577 | 525 | |||||||||||
Operating expenses: | |||||||||||||||
Selling, general and administrative | 216 | 132 | 610 | 413 | |||||||||||
Restructuring costs | — | — | — | 8 | |||||||||||
Goodwill impairment | 939 | — | 939 | — | |||||||||||
Operating (loss) income | (958 | ) | 34 | (972 | ) | 104 | |||||||||
Other income (expense): | |||||||||||||||
Interest income | 1 | 1 | 4 | 4 | |||||||||||
Interest expense | (16 | ) | — | (42 | ) | (2 | ) | ||||||||
Other, net | 4 | — | 18 | 1 | |||||||||||
(Loss) income before taxes and equity in earnings of affiliates | (969 | ) | 35 | (992 | ) | 107 | |||||||||
Income tax benefit (expense) | 60 | (19 | ) | 60 | (33 | ) | |||||||||
Equity in earnings of affiliates | — | — | — | 1 | |||||||||||
Net (loss) income | $ | (909 | ) | $ | 16 | $ | (932 | ) | $ | 75 | |||||
Less: net loss (income) attributable to redeemable non-controlling interests | 3 | — | 3 | (8 | ) | ||||||||||
Net (loss) income attributable to Covetrus | $ | (906 | ) | $ | 16 | $ | (929 | ) | $ | 67 | |||||
(Loss) earnings per share attributable to Covetrus: | |||||||||||||||
Basic | $ | (8.09 | ) | $ | 0.22 | $ | (8.76 | ) | $ | 0.94 | |||||
Diluted | $ | (8.09 | ) | $ | 0.22 | $ | (8.76 | ) | $ | 0.94 | |||||
Weighted average common shares outstanding: | |||||||||||||||
Basic | 112 | 71 | 106 | 71 | |||||||||||
Diluted | 112 | 72 | 106 | 72 |
CONSOLIDATED STATEMENT OF CASH FLOWS FOR SEPTEMBER 30, 2019
COMBINED STATEMENT OF CASH FLOWS FOR SEPTEMBER 30, 2018
(In millions) (Unaudited)
Nine Months Ended September 30, | |||||||
2019 | 2018 | ||||||
Cash flows from operating activities: | |||||||
Net (loss) income | $ | (932 | ) | $ | 75 | ||
Adjustments to reconcile net (loss) income to net cash provided by (used for) operating activities: | |||||||
Depreciation and amortization | 113 | 49 | |||||
Amortization of right-of-use assets | 16 | — | |||||
Goodwill impairment | 939 | — | |||||
Share-based compensation | 35 | 6 | |||||
(Benefit) provision for deferred income taxes | (72 | ) | 1 | ||||
Equity in earnings of affiliates | — | (1 | ) | ||||
Other | (3 | ) | — | ||||
Changes in operating assets and liabilities, net of acquisitions: | |||||||
Accounts receivable, net | (25 | ) | (13 | ) | |||
Inventory, net | (23 | ) | 25 | ||||
Other assets and liabilities | (36 | ) | (52 | ) | |||
Accounts payable and accrued expenses | 21 | (28 | ) | ||||
Net cash provided by operating activities | 33 | 62 | |||||
Cash flows from investing activities: | |||||||
Purchases of property and equipment | (30 | ) | (15 | ) | |||
Payments related to equity investments and business acquisitions, net of cash acquired | (26 | ) | (8 | ) | |||
Net cash used for investing activities | (56 | ) | (23 | ) | |||
Cash flows from financing activities: | |||||||
Proceeds from issuance of debt | 1,220 | — | |||||
Principal payments of debt | (43 | ) | (2 | ) | |||
Debt issuance costs | (24 | ) | — | ||||
Dividend paid to Henry Schein | (1,174 | ) | — | ||||
Issuance of common shares in connection with options | 4 | — | |||||
Net transfers from parent | 165 | 359 | |||||
Distributions to non-controlling shareholders | — | (10 | ) | ||||
Maravet acquisition payment | (9 | ) | — | ||||
Acquisitions of non-controlling interests in subsidiaries | (74 | ) | (380 | ) | |||
Net cash provided by (used for) financing activities | 65 | (33 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | 3 | (1 | ) | ||||
Net change in cash and cash equivalents | 45 | 5 | |||||
Cash and cash equivalents, beginning of period | 23 | 17 | |||||
Cash and cash equivalents, end of period | $ | 68 | $ | 22 | |||
Supplemental disclosure of cash paid for: | |||||||
Interest | $ | 35 | $ | — | |||
Income taxes | $ | 16 | $ | 7 |
Reconciliation of Non-GAAP Financial Measures
To aid investors and analysts with year-over-year comparability for the combined businesses of
The following tables reconcile non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP.
These non-GAAP financial measures have limitations as an analytic tool and should not be considered in isolation or as a substitute for income from operations, net income or any other measure of financial performance reported in accordance with GAAP. Covetrus’ non-GAAP measures may be calculated differently than similarly named measures reported by other companies. In addition, using non-GAAP measures may have limited value as they exclude certain items that may have a material impact on reported financial results and cash flows. When analyzing Covetrus’ performance, it is important to evaluate each adjustment in the reconciliation tables and use adjusted measures in addition to, and not as an alternative to, GAAP measures.
Non-GAAP Pro Forma Net Sales and Segment Net Sales (Unaudited)
Pro forma organic net sales growth is a non-GAAP measure that
The following tables summarize non-GAAP pro forma net sales and non-GAAP pro forma organic net sales growth for
Non-GAAP Pro Forma Net Sales (Unaudited)
Three Months Ended September 30, 2019 | Three Months Ended September 30, 2018 | |||||||||||||||||||
(In millions) | Covetrus | Historical Vets First Choice | Non-GAAP Pro Forma Combined | Historical Animal Health | Historical Vets First Choice | Non-GAAP Pro Forma Combined | ||||||||||||||
Net sales: | $ | 1,018 | $ | — | $ | 1,018 | $ | 923 | $ | 53 | $ | 976 | ||||||||
North America | 543 | — | 543 | 479 | 53 | 532 | ||||||||||||||
Europe | 384 | — | 384 | 351 | — | 351 | ||||||||||||||
APAC & Emerging Markets | 94 | — | 94 | 95 | — | 95 | ||||||||||||||
Eliminations | (3 | ) | — | (3 | ) | (2 | ) | — | (2 | ) | ||||||||||
Nine Months Ended September 30, 2019 | Nine Months Ended September 30, 2018 | |||||||||||||||||||
(In millions) | Covetrus | Historical Vets First Choice (a) | Non-GAAP Pro Forma Combined | Historical Animal Health | Historical Vets First Choice | Non-GAAP Pro Forma Combined | ||||||||||||||
Net sales: | $ | 2,968 | $ | 24 | $ | 2,992 | $ | 2,875 | $ | 149 | $ | 3,024 | ||||||||
North America | 1,592 | 24 | 1,616 | 1,479 | 149 | 1,628 | ||||||||||||||
Europe | 1,114 | — | 1,114 | 1,113 | — | 1,113 | ||||||||||||||
APAC & Emerging Markets | 270 | — | 270 | 291 | — | 291 | ||||||||||||||
Eliminations | (8 | ) | — | (8 | ) | (8 | ) | — | (8 | ) |
(a) Historical Vets First Choice - 2019 - from
Non-GAAP Pro Forma Organic Net Sales Growth (Unaudited)
Three Months Ended September 30, | |||||||||||||||||
2019 | 2018 | ||||||||||||||||
(In millions) | Covetrus | Non-GAAP Pro Forma Combined | Non-GAAP Pro Forma Y/Y Growth | % Change from FX | Switch from Direct to Agency Sales Model | % Change from Mergers and Acquisitions | Non-GAAP Pro Forma Organic Net Sales Growth | ||||||||||
Net sales: | $ | 1,018 | $ | 976 | 4 | % | (2 | )% | (1 | )% | 3 | % | 5 | % | |||
North America | 543 | 532 | 2 | % | — | % | (2 | )% | — | % | 4 | % | |||||
Europe | 384 | 351 | 9 | % | (5 | )% | — | % | 8 | % | 6 | % | |||||
APAC & Emerging Markets | 94 | 95 | (1 | )% | (4 | )% | — | % | — | % | 3 | % | |||||
Eliminations | (3 | ) | (2 | ) | |||||||||||||
Nine Months Ended September 30, | |||||||||||||||||
2019 | 2018 | ||||||||||||||||
(In millions) | Non-GAAP Pro Forma Combined | Non-GAAP Pro Forma Combined | Non-GAAP Pro Forma Y/Y Growth | % Change from FX | Switch from Direct to Agency Sales Model | % Change from Mergers and Acquisitions | Non-GAAP Pro Forma Organic Net Sales Growth | ||||||||||
Net sales: | $ | 2,992 | $ | 3,024 | (1 | )% | (3 | )% | (1 | )% | 1 | % | 2 | % | |||
North America | 1,616 | 1,628 | (1 | )% | — | % | (3 | )% | — | % | 2 | % | |||||
Europe | 1,114 | 1,113 | — | % | (6 | )% | — | % | 3 | % | 3 | % | |||||
APAC & Emerging Markets | 270 | 291 | (7 | )% | (7 | )% | — | % | — | % | — | % | |||||
Eliminations | (8 | ) | (8 | ) |
(a) Numbers in tables may not foot or cross-foot due to rounding
Non-GAAP EBITDA, Pro Forma EBITDA, Adjusted EBITDA, Pro Forma Adjusted EBITDA, Adjusted Net Income (Loss) and Pro Forma Adjusted Net Income (Unaudited)
EBITDA, adjusted EBITDA, pro forma adjusted EBITDA, adjusted net income (loss) and pro forma adjusted net income (loss) are non-GAAP financial measures and should be considered in addition to, but not as a substitute for, the information provided in accordance with GAAP. Our non-GAAP adjusted EBITDA adjustments include share-based compensation, formation of
Adjusted EBITDA and Adjusted Net Income Reconciliation for the Three Months Ended September 30, 2019 (Unaudited) | |||
(In millions) | Three Months Ended September 30, 2019 |
||
Net loss attributable to Covetrus | $ | (906 | ) |
Plus: Depreciation and amortization | 41 | ||
Plus: Interest, net | 16 | ||
Plus: Income tax (benefit) expense | (60 | ) | |
EBITDA | (909 | ) | |
Plus: Share-based compensation | 10 | ||
Plus: Formation of Covetrus | 14 | ||
Plus: IT infrastructure | 2 | ||
Plus: Goodwill impairment | 939 | ||
Less: Minority interest in goodwill impairment | (3 | ) | |
Plus: Other (income) expense items | (4 | ) | |
Adjusted EBITDA | 49 | ||
Depreciation and amortization | (41 | ) | |
Amortization of acquired intangibles | 34 | ||
Interest expense, net | (16 | ) | |
Adjusted income before taxes | 26 | ||
Income tax expense | (7 | ) | |
Adjusted net income attributable to Covetrus | $ | 19 |
Pro Forma Adjusted EBITDA and Adjusted Net Income Reconciliation for the Three Months Ended September 30, 2018 (Unaudited) | |||||||||||||||
Three Months Ended September 30, 2018 | |||||||||||||||
(In millions) | Henry Schein Animal Health Business | Vets First Choice | Spin-off and Other Pro Forma Adjustments | Purchase Price and Related Pro Forma Adjustments | Pro Forma Covetrus | ||||||||||
Net income (loss) attributable to Covetrus | $ | 16 | $ | (10 | ) | $ | (7 | ) | $ | (22 | ) | $ | (23 | ) | |
Plus: Depreciation and amortization | 16 | 4 | — | 22 | 42 | ||||||||||
Plus: Interest expense, net | — | — | 14 | — | 14 | ||||||||||
Plus: Income tax (benefit) expense | 19 | (1 | ) | (3 | ) | (8 | ) | 7 | |||||||
EBITDA | 51 | (7 | ) | 4 | (8 | ) | 40 | ||||||||
Plus: Share-based compensation | 2 | 1 | — | 8 | 11 | ||||||||||
Plus: Transaction costs | — | 4 | (4 | ) | — | — | |||||||||
Adjusted EBITDA | 53 | (2 | ) | — | — | 51 | |||||||||
Depreciation and amortization | (42 | ) | |||||||||||||
Amortization of acquired intangibles | 34 | ||||||||||||||
Interest expense, net | (14 | ) | |||||||||||||
Adjusted income before taxes | 29 | ||||||||||||||
Adjusted income tax expense | (8 | ) | |||||||||||||
Pro forma adjusted net income attributable to Covetrus | $ | 21 |
(a) Numbers in table may not foot or cross-foot due to rounding
Pro Forma Adjusted EBITDA and Adjusted Net Income Reconciliation for the Nine Months Ended September 30, 2019 (Unaudited) | |||||||||||||||
Nine Months Ended September 30, 2019 | |||||||||||||||
(In millions) | Covetrus | Vets First Choice (Jan. 1 to Feb. 7) | Spin-off and Other Pro Forma Adjustments | Purchase Price and Related Pro Forma Adjustments | Pro Forma Covetrus | ||||||||||
Net income (loss) attributable to Covetrus | $ | (929 | ) | $ | (9 | ) | $ | (2 | ) | $ | 1 | $ | (939 | ) | |
Plus: Depreciation and amortization | 113 | 2 | — | 9 | 124 | ||||||||||
Plus: Interest, net | 41 | 1 | 3 | — | 45 | ||||||||||
Plus: Income tax (benefit) expense | (60 | ) | — | (1 | ) | — | (61 | ) | |||||||
EBITDA | (835 | ) | (6 | ) | — | 10 | (831 | ) | |||||||
Plus: Share-based compensation | 35 | — | — | (5 | ) | 30 | |||||||||
Plus: Formation of Covetrus | 27 | 6 | — | (6 | ) | 27 | |||||||||
Plus: Carve-out operating expense | 5 | — | — | — | 5 | ||||||||||
Plus: IT infrastructure | 4 | — | — | — | 4 | ||||||||||
Plus: Goodwill impairment | 939 | — | — | — | 939 | ||||||||||
Less: Minority interest in goodwill impairment | (3 | ) | — | — | — | (3 | ) | ||||||||
Plus: Other (income) expense items | (18 | ) | (2 | ) | — | 1 | (18 | ) | |||||||
Adjusted EBITDA | 154 | (2 | ) | — | — | 153 | |||||||||
Depreciation and amortization | (124 | ) | |||||||||||||
Amortization of acquired intangibles | 102 | ||||||||||||||
Interest expense, net | (45 | ) | |||||||||||||
Adjusted income before taxes | 86 | ||||||||||||||
Income tax expense | (23 | ) | |||||||||||||
Pro forma adjusted net income attributable to Covetrus | $ | 63 |
(a) Numbers in table may not foot or cross-foot due to rounding
Pro Forma Adjusted EBITDA and Adjusted Net Income Reconciliation for the Nine Months Ended September 30, 2018 (Unaudited) | |||||||||||||||
Nine Months Ended September 30, 2018 | |||||||||||||||
(In millions) | Henry Schein Animal Health Business | Vets First Choice | Spin-off and Other Pro Forma Adjustments | Purchase Price and Related Pro Forma Adjustments | Pro Forma Covetrus | ||||||||||
Net income (loss) attributable to Covetrus | $ | 67 | $ | (27 | ) | $ | (17 | ) | $ | (66 | ) | $ | (43 | ) | |
Plus: Depreciation and amortization | 49 | 12 | — | 67 | 128 | ||||||||||
Plus: Interest expense, net | 1 | — | 42 | — | 43 | ||||||||||
Plus: Income tax (benefit) expense | 33 | (3 | ) | (10 | ) | (24 | ) | (4 | ) | ||||||
EBITDA | 150 | (18 | ) | 15 | (23 | ) | 124 | ||||||||
Plus: Share-based compensation | 6 | 3 | — | 23 | 31 | ||||||||||
Plus: Transaction costs | — | 7 | (7 | ) | — | — | |||||||||
Plus: Restructuring costs | 8 | — | — | — | 8 | ||||||||||
Plus: Other (income) expense items | — | 2 | — | — | 2 | ||||||||||
Adjusted EBITDA | 164 | (7 | ) | 8 | — | 165 | |||||||||
Depreciation and amortization | (128 | ) | |||||||||||||
Amortization of acquired intangibles | 104 | ||||||||||||||
Interest expense, net | (43 | ) | |||||||||||||
Adjusted income before taxes | 98 | ||||||||||||||
Adjusted income tax expense | (25 | ) | |||||||||||||
Pro forma adjusted net income attributable to Covetrus | $ | 73 |
(a) Numbers in table may not foot or cross-foot due to rounding
Non-GAAP Free Cash Flow (Unaudited)
Free cash flow is a non-GAAP financial measure and should be considered in addition to, but not as a substitute for, the information provided in accordance with GAAP. Free cash flow is the cash the company produces through its operations, less the cost of expenditures on assets. The company believes that it is an important measurement since it shows how efficient a company is at generating cash.
Free Cash Flow for the Nine Months Ended September 30, 2019 and 2018 | |||||||
Nine Months Ended September 30, | |||||||
(In millions) | 2019 | 2018 | |||||
Net cash provided by operating activities | $ | 33 | $ | 62 | |||
Less: Purchases of property and equipment | (30 | ) | (15 | ) | |||
Free cash flow | $ | 3 | $ | 47 |
Contacts:
207-550-8106 | nicholas.jansen@covetrus.com
Kiní Schoop | Public Relations
207-550-8018 | kini.schoop@covetrus.com
Source: Covetrus