NASDAQ$CERT

Certara Inc. · Q3 2021 earnings

Q3 2021 earnings · · Investor relations

Briefing

Revenue increased by 23% and Pinnacle 21 was acquired.

Certara reported a strong third quarter with a 23% increase in revenue compared to the same quarter last year. The company completed the acquisition of Pinnacle 21 and raised its full-year 2021 guidance.

  • Revenue was $73.9 million, compared to $60.3 million in the third quarter of 2020, representing growth of 23% over the third quarter of 2020.
  • Net loss was $1.8 million, compared to net income of $1.2 million in the third quarter of 2020, representing a decrease of $3.0 million over the third quarter of 2020.
  • Adjusted EBITDA was $26.1 million, compared to $20.5 million in the third quarter of 2020, representing growth of 28% over the third quarter of 2020.
  • Completed the acquisition of Pinnacle 21, LLC (“Pinnacle”) on October 1, 2021, for total consideration of $250 million cash and 2,239,717 shares of restricted common stock of the Company.

Headline financials

Total Revenue

$73.9M

Previous: $60.3M+22.6%
EPS (adj)

$0.07

Previous: $0.01+600.0%
Adjusted EBITDA

$26.1M

No prior period
Adjusted Net Income

$10.8M

No prior period
Capital Expenditures

-$995K

Previous: $144K-791.0%
Free Cash Flow

-$2.76M

Previous: $15.3M-118.0%
Net Income

-$1.76M

Previous: $1.23M-243.6%
Operating Income

-$761K

Previous: $7.5M-110.2%
Gross Profit

$45.2M

Previous: $37.3M+21.2%
Cash & Equivalents

$417M

Previous: $29.9M+1292.4%
Total Assets

$1.41B

No prior period

Revenue & EPS history

Certara · Revenue · Quarterly

$73.9M

Q3 2021+22.6%vs Q3 2020
Beat estimate in 7 of 9 quarters(78%)
ActualEstimate

Revenue by segment

Certara · $90.3M total across 2 segments · Q1 2023

  • Services
    $57.3M
  • Software
    $33M

Forward guidance

Certara updated its full year 2021 guidance, raising the ranges for revenue, adjusted EBITDA and adjusted diluted earnings per share, based on performance through September and the expected impact of Pinnacle 21 in the fourth quarter.

Tailwinds

  • Revenue between $288 million and $291 million
  • Adjusted revenue between $292 million and $295 million
  • Adjusted EBITDA between $106 million and $108 million
  • Adjusted diluted earnings per share between $0.22 and $0.26
  • Fully diluted shares for 2021 to be in the range of 155 million to 156 million

Headwinds

  • Effective annual tax rate for 2021 to be in the range of 40% to 45%.
  • variability and low visibility with respect to costs related to acquisitions
  • variability and low visibility with respect to costs related to financings
  • variability and low visibility with respect to costs related to employee stock compensation programs
  • potential adjustments to future earnings

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 19 quarterly earnings reports · overlaid with Q3 2021

Historical avgQ3 2021

-4.5%

Avg return

Earnings day

-6.4%

Avg return

5 days after

-3.8%

Avg return

30 days after

33%

8 / 24 earnings

Positive

+28.1%

Q3 2022

Best reaction

-23.0%

Q3 2025

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-18.9%-29.2%-17.9%
Q4 2025+3.3%+9.9%-12.7%
Q3 2025-23.0%-26.5%-18.2%
Q1 2025-11.0%-6.3%-8.5%
Q3 2024+6.6%+5.6%+5.2%
Q2 2024-12.6%-16.1%-23.1%
Q1 2024-7.3%-3.6%-2.6%
Q4 2023+7.8%+9.6%+5.3%
Q3 2023+0.6%+3.5%+30.6%
Q2 2023-10.0%-6.5%-19.5%
Q1 2023-9.5%-12.1%-18.9%
Q4 2022+19.4%+18.4%+33.1%
Q3 2022+28.1%+37.6%+64.0%
Q2 2022-15.6%-27.2%-32.6%
Q1 2022-2.5%-11.3%-1.4%
Q4 2021-13.5%-21.9%-15.2%
Q4 2019-13.5%-21.9%-15.2%
Q3 2021-5.5%-7.4%-33.7%
Q3 2020-5.5%-7.4%-33.7%
Q2 2020+0.6%+0.3%+34.9%
Q2 2021+2.3%-0.0%+35.3%
Q1 2020-0.1%-7.9%-10.7%
Q1 2021-6.1%-9.9%-16.4%
Q4 2020-22.2%-23.5%-19.1%
Q3 2019
Q2 2019
Q1 2019

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