Natus Medical Announces Fourth Quarter 2021 Financial Results
02/24/2022 - 04:01 PM
Q4-2021 Key Results Revenue (millions) $128.7 • Revenue increased 8% compared to Q4 2020 • Revenue increased 14% compared to full year 2020 • $12.8 million in operating cash flow for Q4 2021• $63.9 million in operating cash flow for the year 2021GAAP EPS $0.05 Non-GAAP EPS $0.47
PLEASANTON, Calif., Feb. 24, 2022 (GLOBE NEWSWIRE) -- Natus Medical Incorporated (NASDAQ:NTUS) (the “Company” or “Natus”), a leading provider of medical device solutions to screen, diagnose, and treat disorders affecting the brain, neural pathways, and eight sensory nervous systems, today announced financial results for the three months and full year ended December 31, 2021.
For the fourth quarter ended December 31, 2021, the Company reported revenue of $128.7 million , an increase of 8.4% compared to $118.7 million reported for the fourth quarter 2020. GAAP gross margin was 56.8% during the fourth quarter of 2021 compared to 55.3% in the fourth quarter 2020. GAAP net income was $1.7 million , or $0.05 earnings per diluted share, compared with GAAP net income of $5.2 million , or $0.15 earnings per diluted share in the fourth quarter 2020.
Non-GAAP gross margin was 59.3% in the fourth quarter 2021 compared to 58.1% reported for the fourth quarter of 2020. Non-GAAP earnings per diluted share was $0.47 for the fourth quarter 2021, compared to $0.39 in the fourth quarter 2020. Non-GAAP net income was $16.2 million in the fourth quarter 2021 compared to $13.1 million in the fourth quarter 2020.
For the full year ended December 31, 2021, the Company reported revenue of $473.4 million , an increase of 13.9% compared to $415.7 million reported for the same period in 2020. GAAP gross margin was 57.8% vs. 52.1% reported for the same period in 2020. GAAP net income was $13.2 million , or $0.39 earnings per diluted share, compared with GAAP net loss of $16.6 million , or $0.49 per share in the same period in 2020.
Non-GAAP gross margin was 60.0% in 2021 vs. 56.6% reported for the same period in 2020. Non-GAAP earnings per diluted share was $1.20 for the full year ended December 31, 2021, compared to $0.39 in the same period in 2020. The Company reported non-GAAP net income of $40.8 million for the full year ended December 31, 2021, compared to prior year's non-GAAP net income of $13.1 million .
“I would like to thank our Natus Teammates for their efforts to deliver growth in both revenue and income in the fourth quarter despite challenges from both Covid and supply chain related constraints,” said Thomas J. Sullivan, President and Chief Executive Officer of Natus. “Throughout the year we focused on ensuring our products were available to clinicians and despite incurring over $1.7 million in higher costs in the fourth quarter alone, our non-GAAP earnings per share increased more than 200% .”
Mr. Sullivan continued, “I would like to congratulate Dr. Christopher Chung, Natus Vice President of Quality, Regulatory Affairs and Chief Medical Officer, who has informed me of his decision to retire in April after a twenty-two-year career at the company. Dr. Chung is a valued leader at Natus and I am pleased that he will continue to support our Team in a consultative role as our Chief Medical Officer through the end of the year. I wish Chris and his family the best in this next phase of his life.”
“As a result of a strategic review of our markets, Natus will realign its portfolio and commercial infrastructure to focus on the clinical areas of the Brain, Neural Pathways, and eight Sensory Nervous Systems.” “We believe a focus on higher value markets will position us for increased growth while also enabling us to reduce complexity to improve our execution and long-term margin expansion,” concluded Mr. Sullivan.
Financial Guidance
In the first quarter of 2022, Natus will realign its commercial organization on the clinical focus areas of Brain, Neural Pathways, and eight Sensory Nervous Systems. The Company will transition to a matrix infrastructure of non-commercial resources in support of innovation and entrepreneurial growth in each clinical focus area in the coming months while reviewing its cost structure. As a result of these changes, the Company is only providing annual guidance at this point which excludes the impact of any acquisitions or divestitures.
For the full year 2022, the Company's revenue is expected to be between $491.0 million and $499.0 million and non-GAAP earnings per share is expected to be between $1.36 and $1.49 . 2022 guidance assumes an incremental $16.0 million of extraordinary costs associated with acquiring semiconductors and other components outside of our normal supply chain due to their constrained availability. Additional unforeseen constraints could further impact our profitability. While these extraordinary costs negatively impact profitability in the near term, a return to more normal supply chain conditions could positively impact profitability in the future. At this time, we do not anticipate semiconductor and component constraints to impact revenue.
The Company's non-GAAP earnings per share guidance excludes charges for amortization expense associated with intangible assets from prior acquisitions, certain other expenses, and related tax effect, which the Company expects to be approximately $15.6 million for the year 2022, which the Company expects will reduce GAAP earnings per share by approximately $0.46 .
Use of Non-GAAP Financial Measures
The Company presents in this release its non-GAAP net income, non-GAAP earnings per diluted share, non-GAAP gross margin and non-GAAP operating margin results which exclude amortization expense associated with certain acquisition-related intangibles, restructuring charges, certain discrete items, direct costs of acquisitions, and the related tax effects. A reconciliation between non-GAAP and GAAP financial measures is included in this press release.
The Company believes that the presentation of results excluding these charges or gains provides meaningful supplemental information to both management and investors that is indicative of the Company's core operating results and better reflects the ongoing economics of the Company's operations. The Company believes these non-GAAP financial measures facilitate comparison of operating results across reporting periods.
Specifically, the Company excludes the following charges, gains, and their related tax effects in the calculation of non-GAAP net income, non-GAAP earnings per diluted share and non-GAAP operating profit: 1) Non-cash amortization expense associated with certain acquisition-related intangibles. The charges reflect an estimate of the cost of acquired intangible assets over their estimated useful lives. 2) Restructuring and other non-recurring charges. The Company has over time completed multiple acquisitions of other companies and businesses. Following an acquisition, the Company will, as it determines appropriate, initiate restructuring events to eliminate redundant costs. Restructuring expenses, which are excluded in the non-GAAP items, are exclusively related to permanent reductions in our workforce and redundant facility closures. Other non-recurring costs are associated with the transition of the executive management team. These costs can include stock compensation from accelerated vesting of stock, severance payouts and related payroll expenses. 3) Certain discrete items. These items represent significant infrequent charges or gains that management believes should be viewed outside of normal operating results, and each significant discrete transaction is evaluated to determine whether it should be excluded from non-GAAP reporting. These items are specifically identified when they occur. 4) Direct costs of acquisitions. These are direct acquisition-related costs that occur when the Company makes an acquisition, such as professional fees, due diligence costs, and earn-out adjustments.
The Company applies GAAP methodologies in computing its non-GAAP tax provision by determining the annual expected effective tax rate after taking into account items excluded for non-GAAP financial reporting purposes. The Company’s non-GAAP tax expense and its non-GAAP effective tax rate are generally higher than its GAAP tax expense and GAAP effective tax rate because the income subject to taxes would be higher due to the effect of the expenses excluded from non-GAAP financial reporting. The nature of each quarterly discrete transaction will be evaluated to determine whether it should be excluded from non-GAAP reporting.
The Company's management uses these non-GAAP financial measures in assessing the Company's performance and when planning, forecasting, and analyzing future periods and the Company believes that investors also benefit from being able to refer to these non-GAAP financial measures along with the GAAP operating results. These non-GAAP financial measures also facilitate management's internal comparisons to the Company's historical performance. The non-GAAP financial measures disclosed by the Company should not be considered a substitute for or superior to financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements should be carefully evaluated.
Conference Call
Natus has scheduled a conference call to discuss this announcement beginning at 8:00 a.m. Eastern Time (5:00 a.m. Pacific Time) tomorrow, February 25, 2022. Individuals interested in listening to the conference call may do so by dialing 1-844-634-1441 for domestic callers, or 1-508-637-5658 for international callers, and entering reservation code 6682846. A telephone replay will be available for 48 hours following the conclusion of the call by dialing 1-855-859-2056 for domestic callers, or 1-404-537-3406 for international callers, and entering reservation code 6682846. The conference call also will be available real-time via the Internet at http://investor.natus.com, and a recording of the call will be available on the Company’s Web site for 90 days following the completion of the call. A companion Investor Presentation will be posted to the Company's Web site at 7:00 a.m. Eastern Time tomorrow, February, 25, 2022.
About Natus Medical Incorporated
Natus delivers innovative and trusted solutions to screen, diagnose, and treat disorders affecting the brain, neural pathways, and eight sensory nervous systems to advance the standard of care and improve patient outcomes and quality of life. The Company offers hardware, advanced software and algorithms, and consumables that provide stimulus, acquire and monitor physiological signals, and capture the body’s response. With sales in over 100 countries, Natus is the clear worldwide leader in neurodiagnostics, pediatric retinal imaging, and infant hearing screening, as well as a leading company in hearing assessment, hearing instrument fitting, balance, and intracranial pressure monitoring.
Additional information about Natus Medical can be found at www.natus.com.
Forward-Looking Statements
This press release contains forward-looking statements, which are generally statements that are not historical facts. Forward-looking statements can be identified by the words “expects”, “anticipates”, “believes”, “intends”, “estimates”, “plans”, “will”, “outlook” and similar expressions. Forward-looking statements are based on management's current plans, estimates, assumptions and projections, and speak only as of the date they are made. These statements relate to current estimates and assumptions of our management as of the date of this press release and involve known and unknown risks, uncertainties and other factors that may cause actual results, levels of activity, performance, or achievements to differ materially from those expressed or implied by the forward-looking statements. Forward-looking statements are only predictions and the actual events or results may differ materially. Natus cannot provide any assurance that its future results or the results implied by the forward-looking statements will meet expectations. The Company's future results could differ materially due to a number of factors, including supply chain delays and constraints, the business, social and economic impact of the COVID-19 pandemic on the Company's business and results of operations, the ability of the Company to realize the anticipated benefits from its strategic alignment, the Company's ability to successfully pursue, acquire and integrate acquisitions, the demand for Natus products and services, the impact of adverse global economic conditions and changing governmental regulations, including foreign exchange rate changes, on the Company's target markets, the Company's ability to expand its sales in international markets, the Company's ability to maintain current sales levels in a mature domestic market, the Company's ability to control costs, risks associated with bringing new products to market, and the Company's ability to fulfill product orders on a timely basis, as well as those factors identified under the heading Item 1A “Risk Factors” in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2020, Quarterly Report on Form 10-Q for the periods ended March 31, 2021, June 30, 2021, September 30, 2021. Natus disclaims any obligation to update information contained in any forward looking statement, except as required by law.
Natus Medical Incorporated Drew Davies Executive Vice President and Chief Financial Officer (925) 223-6700InvestorRelations@Natus.com
NATUS MEDICAL INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (unaudited) (in thousands, except per share amounts) Three Months Ended Twelve Months Ended December 31, 2021 December 31, 2020 December 31, 2021 December 31, 2020 Revenue $ 128,656 $ 118,718 $ 473,438 $ 415,684 Cost of revenue 53,996 51,247 193,015 185,912 Intangibles amortization 1,617 1,801 6,743 13,241 Gross profit 73,043 65,670 273,680 216,531 Gross profit margin 56.8 % 55.3 % 57.8 % 52.1 % Operating expenses: Marketing and selling 29,295 27,715 116,014 107,282 Research and development 13,750 14,722 56,306 61,296 General and administrative 12,436 12,359 52,753 49,113 Intangibles amortization 5,632 3,894 17,129 15,224 Restructuring 7,230 1,966 7,699 3,809 Total operating expenses 68,343 60,656 249,901 236,724 Income (loss) from operations 4,700 5,014 23,779 (20,193 ) Interest expense (217 ) (856 ) (1,872 ) (3,656 ) Other income (expense), net (852 ) 2,182 (2,552 ) 1,784 Income (loss) before provision for (benefit from) income tax 3,631 6,340 19,355 (22,065 ) Provision for (benefit from) income tax 1,886 1,135 6,178 (5,452 ) Net income (loss) $ 1,745 $ 5,205 $ 13,177 $ (16,613 ) Net income (loss) per share: Basic $ 0.05 $ 0.15 $ 0.39 $ (0.49 ) Diluted $ 0.05 $ 0.15 $ 0.39 $ (0.49 ) Weighted-average shares: Basic 33,799 33,861 33,670 33,562 Diluted 34,122 33,903 33,974 33,562
NATUS MEDICAL INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (in thousands) December 31, December 31, 2021 2020 ASSETS Current assets: Cash and investments $ 75,595 $ 82,082 Accounts receivable 111,760 93,133 Inventories 67,745 75,650 Other current assets 22,191 20,837 Total current assets 277,291 271,702 Property and equipment 21,783 24,516 Operating lease right-of-use assets 9,288 11,669 Goodwill and intangible assets 214,170 244,040 Deferred income tax 23,161 27,563 Other assets 18,595 20,904 Total assets $ 564,288 $ 600,394 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 36,405 $ 23,429 Current portion of long-term debt — 50,000 Accrued liabilities 48,135 44,236 Deferred revenue 25,097 21,308 Current portion of operating lease liabilities 4,964 6,779 Total current liabilities 114,601 145,752 Long-term debt — 5,840 Deferred income tax 1,133 10,298 Operating lease liabilities 6,567 8,959 Other long-term liabilities 17,237 18,451 Total liabilities 139,538 189,300 Total stockholders’ equity 424,750 411,094 Total liabilities and stockholders’ equity $ 564,288 $ 600,394
NATUS MEDICAL INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (in thousands) Three Months Ended Twelve Months Ended December 31, 2021 December 31, 2020 December 31, 2021 December 31, 2020 Operating activities: Net income (loss) $ 1,744 $ 5,205 $ 13,177 $ (16,613 ) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Provision for losses on accounts receivable (92 ) 32 181 1,190 Depreciation and amortization 6,754 7,126 28,091 28,115 Loss on equity method investment adjustment 159 133 602 133 (Gain) loss on disposal of property and equipment 90 119 (1,426 ) 268 Impairment of intangible assets 2,004 — 2,004 6,678 Impairment of property and equipment 279 — 279 — Warranty reserve 2,466 880 3,989 2,009 Share-based compensation 5,889 2,507 14,161 9,566 Loss on commencement of sales-type leases — 20 3 1,881 Non cash lease expense — 1,353 — 1,353 Changes in operating assets and liabilities: Accounts receivable (12,683 ) (12,716 ) (13,111 ) 17,651 Inventories 1,175 8,356 4,830 1,939 Prepaid expenses and other assets 1,998 9,021 (1,880 ) (1,055 ) Accounts payable 8,301 (4,504 ) 13,530 (4,523 ) Accrued liabilities 315 417 (507 ) (13,427 ) Deferred revenue (171 ) 1,779 4,458 838 Deferred income tax (5,446 ) (3,403 ) (4,386 ) (1,577 ) Net cash provided by operating activities 12,782 16,325 63,995 34,426 Investing activities: Acquisition of businesses, net of cash acquired — (1,997 ) — (1,997 ) Purchase of property and equipment (671 ) (992 ) (3,620 ) (8,609 ) Purchase of equity investments — (1,000 ) (1,000 ) (2,000 ) Proceeds from sale of property and equipment — — 2,674 — Net cash used in investing activities (671 ) (3,989 ) (1,946 ) (12,606 ) Financing activities: Proceeds from stock option exercises and ESPP 243 656 855 1,314 Repurchase of common stock — — — (10,495 ) Taxes paid related to settlement of equity awards (2,853 ) (58 ) (4,107 ) (1,994 ) Deferred debt issuance costs — — — (1,175 ) Principal payments of financing lease liability (84 ) (112 ) (410 ) (527 ) Proceeds from long-term borrowings — — — 60,000 Payments on borrowings — (10,000 ) (57,000 ) (58,000 ) Net cash used in financing activities (2,694 ) (9,514 ) (60,662 ) (10,877 ) Exchange rate changes effect on cash and cash equivalents (2,601 ) 4,724 (7,874 ) 7,842 Net increase (decrease) in cash and cash equivalents 6,816 7,546 (6,487 ) 18,785 Cash and cash equivalents, beginning of period 68,779 74,536 82,082 63,297 Cash and cash equivalents, end of period $ 75,595 $ 82,082 $ 75,595 $ 82,082
NATUS MEDICAL INCORPORATED AND SUBSIDIARIES RECONCILIATION OF NON-GAAP ADJUSTMENTS (unaudited) (in thousands, except per share amounts) Three Months Ended Twelve Months Ended December 31, 2021 December 31, 2020 December 31, 2021 December 31, 2020 GAAP based results: Income (loss) before provision for income tax $ 3,631 $ 6,340 $ 19,355 $ (22,065 ) Non-GAAP adjustments: Intangibles amortization (COGS) 1,617 1,801 6,743 13,241 Recall accrual and remediation efforts (COGS) — (63 ) — (428 ) Restructuring and other non-recurring costs (COGS) 1,700 1,615 4,069 5,849 COVID-19 relief (COGS) (21 ) — (505 ) — Intangibles amortization (OPEX) 5,632 3,894 17,129 15,224 Direct costs of acquisitions (OPEX) — 112 21 112 Restructuring and other non-recurring costs (OPEX) 7,976 3,033 9,077 4,793 COVID-19 relief (OPEX) (266 ) — (3,391 ) — Restructuring and other non-recurring costs (OI&E) — 206 (80 ) 206 Non-GAAP income (loss) before provision for (benefit from) income tax 20,269 16,938 52,418 16,932 Income tax expense (benefit), as adjusted $ 4,077 $ 3,885 $ 11,631 $ 3,790 Non-GAAP net income $ 16,192 $ 13,053 $ 40,787 $ 13,142 Non-GAAP earnings per share: Basic $ 0.48 $ 0.39 $ 1.21 $ 0.39 Diluted $ 0.47 $ 0.39 $ 1.20 $ 0.39 Weighted-average shares used to compute Basic non-GAAP earnings per share 33,799 33,861 33,670 33,562 Diluted non-GAAP earnings per share 34,122 33,903 33,974 33,628
NATUS MEDICAL INCORPORATED AND SUBSIDIARIES RECONCILIATION OF NON-GAAP ADJUSTMENTS (unaudited) (in thousands, except per share amounts) Three Months Ended Twelve Months Ended December 31, 2021 December 31, 2020 December 31, 2021 December 31, 2020 GAAP Gross Profit $ 73,043 $ 65,670 $ 273,680 $ 216,531 Amortization of intangibles 1,617 1,801 6,743 13,241 Recall accrual and remediation efforts — (63 ) — (428 ) COVID-19 Relief (21 ) — (505 ) — Restructuring and other non-recurring costs 1,700 1,615 4,069 5,849 Non-GAAP Gross Profit $ 76,339 $ 69,023 $ 283,987 $ 235,193 Non-GAAP Gross Margin 59.3 % 58.1 % 60.0 % 56.6 % GAAP Operating Income (Loss) $ 4,700 $ 5,014 $ 23,779 $ (20,193 ) Amortization of intangibles 7,249 5,695 23,872 28,465 COVID-19 Relief (287 ) — (3,896 ) — Recall accrual and remediation efforts — (63 ) — (428 ) Restructuring and other non-recurring costs 9,676 4,648 13,146 10,642 Direct cost of acquisitions — 112 21 112 Non-GAAP Operating Income $ 21,338 $ 15,406 $ 56,922 $ 18,598 Non-GAAP Operating Margin 16.6 % 13.0 % 12.0 % 4.5 % GAAP Income Tax Expense (Benefit) $ 1,886 $ 1,135 $ 6,178 $ (5,452 ) Effect of accumulated change of pretax income 2,921 2,237 7,336 8,729 Effect of change in annual expected tax rate (2,289 ) (139 ) (2,903 ) (139 ) Difference in GAAP vs Non-GAAP discrete 539 — — — Restructuring and other expenses 1,020 652 1,020 652 Non-GAAP Income Tax Expense (Benefit) $ 4,077 $ 3,885 $ 11,631 $ 3,790 Twelve Months Ended December 31, 2022 GAAP EPS Guidance $0.90 - $1.03 Amortization of intangibles 0.53 Tax effect (0.07) Non-GAAP EPS Guidance $1.36 - $1.49
NATUS MEDICAL INCORPORATED AND SUBSIDIARIES GROSS MARGIN BY END MARKETS (unaudited) (in thousands) Three Months Ended Twelve Months Ended December 31, 2021 December 31, 2020 December 31, 2021 December 31, 2020 Neuro: Revenue $ 75,213 $ 68,060 $ 284,767 $ 235,739 Cost of revenue 30,330 29,301 112,384 98,745 Intangibles amortization 750 828 3,024 9,697 Gross profit $ 44,133 $ 37,931 $ 169,359 $ 127,297 Gross profit margin 58.7 % 55.7 % 59.5 % 54.0 % Newborn Care: Revenue $ 28,261 $ 28,165 $ 105,023 $ 105,024 Cost of revenue 12,776 10,763 43,967 46,277 Intangibles amortization — 67 135 260 Gross profit $ 15,485 $ 17,335 $ 60,921 $ 58,487 Gross profit margin 54.8 % 61.5 % 58.0 % 55.7 % Hearing & Balance: Revenue $ 25,182 $ 22,493 $ 83,648 $ 74,921 Cost of revenue 10,890 11,183 36,664 40,890 Intangibles amortization 867 906 3,584 3,284 Gross profit $ 13,425 $ 10,404 $ 43,400 $ 30,747 Gross profit margin 53.3 % 46.3 % 51.9 % 41.0 % Consolidated: Revenue $ 128,656 $ 118,718 $ 473,438 $ 415,684 Cost of revenue 53,996 51,247 193,015 185,912 Intangibles amortization 1,617 1,801 6,743 13,241 Gross profit $ 73,043 $ 65,670 $ 273,680 $ 216,531 Gross profit margin 56.8 % 55.3 % 57.8 % 52.1 %
NATUS MEDICAL INCORPORATED AND SUBSIDIARIES RECONCILIATION OF NON-GAAP GROSS MARGIN BY END MARKETS (unaudited) (in thousands) Three Months Ended Twelve Months Ended December 31, 2021 December 31, 2020 December 31, 2021 December 31, 2020 Neuro: GAAP Gross Profit $ 44,133 $ 37,931 $ 169,359 $ 127,297 Amortization of intangibles 750 828 3,024 9,697 Direct costs of acquisitions — — — — COVID-19 Relief (7 ) — (156 ) — Restructuring and other non-recurring costs 1,541 511 3,266 2,804 Non-GAAP Gross Profit $ 46,417 $ 39,270 $ 175,493 $ 139,798 Non-GAAP Gross Margin 61.7 % 57.7 % 61.6 % 59.3 % Newborn Care: GAAP Gross Profit $ 15,485 $ 17,335 $ 60,921 $ 58,487 Amortization of intangibles — 67 135 260 Recall accrual and remediation efforts — (63 ) — (428 ) Restructuring and other non-recurring costs 159 753 522 1,075 Non-GAAP Gross Profit $ 15,644 $ 18,092 $ 61,578 $ 59,394 Non-GAAP Gross Margin 55.4 % 64.2 % 58.6 % 56.6 % Hearing & Balance: GAAP Gross Profit $ 13,425 $ 10,404 $ 43,400 $ 30,747 Amortization of intangibles 867 906 3,584 3,284 COVID-19 Relief (14 ) — (349 ) — Restructuring and other non-recurring costs — 351 281 1,970 Non-GAAP Gross Profit $ 14,278 $ 11,661 $ 46,916 $ 36,001 Non-GAAP Gross Margin 56.7 % 51.8 % 56.1 % 48.1 % Consolidated: GAAP Gross Profit $ 73,043 $ 65,670 $ 273,680 $ 216,531 Amortization of intangibles 1,617 1,801 6,743 13,241 COVID-19 Relief (21 ) — (505 ) — Recall accrual and remediation efforts — (63 ) — (428 ) Restructuring and other non-recurring costs 1,700 1,615 4,069 5,849 Non-GAAP Gross Profit $ 76,339 $ 69,023 $ 283,987 $ 235,193 Non-GAAP Gross Margin 59.3 % 58.1 % 60.0 % 56.6 %
NATUS MEDICAL INCORPORATED AND SUBSIDIARIES GEOGRAPHIC REVENUE (unaudited) (in thousands) Three Months Ended Twelve Months Ended December 31, 2021 December 31, 2020 December 31, 2021 December 31, 2020 Consolidated Revenue: United States $ 75,355 $ 69,317 $ 285,979 $ 252,496 International 53,301 49,401 187,459 163,188 Totals $ 128,656 $ 118,718 $ 473,438 $ 415,684 United States 59 % 58 % 60 % 61 % International 41 % 42 % 40 % 39 % Totals 100 % 100 % 100 % 100 %