UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 1.01. Entry into a Material Definitive Agreement.
On March 21, 2022, SmartRent, Inc., a Delaware corporation (the “Company”), entered into a definitive Agreement and Plan of Merger (the “Merger Agreement”) by and among the Company, Atlas Merger Corp., a Delaware corporation and a wholly-owned subsidiary of the Company (“Merger Sub”), SightPlan Holdings, Inc., a Delaware corporation (“SightPlan”), and Joseph Westlake, solely in his capacity as the representative of the SightPlan securityholders (the “Representative”). SightPlan provides a real estate operating platform that offers automated answering, resident engagement, field service and maintenance management, inspections management, and due diligence and audit management to real estate owners and managers.
The transaction signed on March 21, 2022 and closed on March 22, 2022 (the “Closing”), as Merger Sub merged with and into SightPlan (the “Merger”) pursuant to the terms of the Merger Agreement. SightPlan survived the Merger as a wholly owned subsidiary of the Company. At the Closing, the Company paid $135.0 million in cash for SightPlan, subject to certain customary purchase price adjustments provided for in the Merger Agreement.
The Merger Agreement includes representations, warranties and covenants of the parties that are customary for a transaction of this nature. The Merger Agreement also contains certain indemnification obligations with respect to breaches of representations and warranties and certain other specified matters.
The foregoing description of the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Merger Agreement.
A copy of the Merger Agreement will be timely filed as an exhibit to an upcoming periodic report in accordance with applicable rules and regulations of the Securities and Exchange Commission (the “SEC”). The Merger Agreement will be filed to provide investors with information regarding its terms and is not intended to provide any factual information about the Company, Merger Sub, SightPlan or the Representative. The representations, warranties and covenants in the Merger Agreement were made only for the purpose of the Merger Agreement and solely for the benefit of the parties to the Merger Agreement as of specific dates. Such representations, warranties and covenants may have been made for the purposes of allocating contractual risk between the parties to the Merger Agreement instead of establishing these matters as facts, may or may not have been accurate as of any specific date, and may be subject to important limitations and qualifications and may therefore not be complete. The representations, warranties and covenants in the Merger Agreement may also be subject to standards of materiality applicable to the contracting parties that may differ from those applicable to investors. Investors should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the Company or SightPlan or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations, warranties and covenants may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures.
Item 2.02. Results of Operations and Financial Condition.
On March 24, 2022, the Company issued a press release announcing its financial results for the fourth quarter, and fiscal year ended, December 31, 2021. A copy of that press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information in this Item 2.02, including the information in Exhibit 99.1 attached hereto pertaining to this Item 2.02, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as expressly set forth by specific reference in such a filing.
Item 7.01. Regulation FD Disclosure.
On March 24, 2022, the Company also issued a press release announcing the execution and consummation of the Merger, as described above. A copy of that press release is furnished as Exhibit 99.2 to this Current Report on Form 8-K.
The information in this Item 7.01, including the information in Exhibit 99.2 attached hereto pertaining to this Item 7.01, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as expressly set forth by specific reference in such a filing.
This Current Report on Form 8-K will not be deemed an admission as to the materiality of any information contained in this Item 7.01 (including Exhibit 99.2).
Item 9.01. Exhibits.
(d) Exhibits.
Exhibit No. Description
104 Cover Page Interactive Data File (formatted as Inline XBRL).
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: March 24, 2022
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SMARTRENT, INC. |
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By: |
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/s/ Lucas Haldeman |
Name: |
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Lucas Haldeman |
Title: |
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Chief Executive Officer
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Exhibit 99.1
SmartRent Reports Fourth Quarter and Full-Year 2021 Financial Results and Provides 2022 Guidance
Company grew Total Revenue 111% to approximately $111 million year-over-year,
Aggregate Units Deployed and Committed grew to over 1.0 Million
Scottsdale, Ariz., March 24, 2022 – (BUSINESS WIRE) – SmartRent, Inc. (NYSE: SMRT) (“SmartRent” or the “Company”), a leading provider of smart home and smart building automation for property owners, managers, developers, homebuilders and residents, today reported financial results for the full-year and fourth quarter ended December 31, 2021.
“SmartRent celebrated many notable successes in 2021. From our public listing on the New York Stock Exchange in August 2021, to reaching record revenue levels and launching several new, best-in-class products, I could not be more proud of our team and all that we accomplished last year,” said Lucas Haldeman, SmartRent CEO. “In 2022, we’re looking forward to continuing to build on our strong foundation and solidify our position as the market leader in enterprise smart home solutions. We have sufficient capital resources to support our organic growth and incremental external growth initiatives. We are confident in the direction of our business and inspired by the opportunity ahead for our Company, our customers, and all of our stakeholders.“
Fourth Quarter 2021 Highlights
1
Full-Year 2021 Highlights
Fourth Quarter and Full-Year Results
Total revenue increased 155% to $34.7 million in the fourth quarter of 2021 from $13.6 million in the fourth quarter of 2020. For the year, total revenue increased 111% to $110.6 million, as compared to $52.5 million in 2020. For the fourth quarter and the full year, the increase in revenues was driven primarily by growth in the Company’s record Units Deployed, increased subscriptions for the Company’s software applications, growth in its customer base and increased monthly SaaS subscription rates.
Operating expenses rose 185% to $22.8 million in the fourth quarter of 2021 from $8.0 million in the prior year period. For the year, operating expenses increased 96% to $61.6 million as compared to $31.4 million in 2020. Contributing to the increase in both periods were higher sales and marketing, and research and development expenses associated with hiring and scaling those teams to support SmartRent’s current and anticipated pace of growth. The Company increased total headcount to 639 employees at the end of 2021, a 147% year-over-year increase. SmartRent anticipates the need to carefully expand these teams in 2022; however, the rate of growth should slow as the Company realizes efficiencies and approaches staffing levels necessary to meet near-term demand. Higher general and administrative expenses, specifically legal, insurance, banking and consulting fees, equity-based compensation, and other activities related to operating as a public company, also contributed to the increase.
Net loss was $(26.0) million in the fourth quarter 2021, as compared to $(10.7) million in the fourth quarter of 2020. For the full-year 2021, net loss was $(72.0) million as compared to $(37.1) for full-year 2020. Contributing to the loss was a warranty charge, recorded as a component of hardware cost of revenues, $0.7 million in the fourth quarter of 2021 and $6.4 million for full-year 2021, related to a battery defect in a portion of its SmartHubs.
Adjusted EBITDA was $(21.8) million for the fourth quarter of 2021 and $(55.6) million for the full-year as compared to $(6.8) million in the fourth quarter of 2020 and $(26.7) million for the full-year 2020.
Total deferred revenue was $95.6 million as of December 30, 2021, up from $53.5 million on December 31, 2020.
At year-end, the Company had $432.1 million of cash and cash equivalents on its balance sheet and no outstanding debt.
Supply Chain
The Company has taken proactive steps to support its logistics and supply chain management efforts in light of sustained headwinds in the global supply chain resulting from the COVID-19 pandemic. Despite these measures, there may be unanticipated events outside of the Company’s control that may impact its supply chain; examples include factory closures due to the resurgence of COVID-19 and continued shortages of component parts.
Subsequent Events
On March 22, 2022, SmartRent acquired SightPlan, Inc. (“SightPlan”), a leader in multifamily workflow management, for approximately $135 million in cash. The acquisition advances SmartRent’s product roadmap and augments the breadth of cloud-based SaaS solutions for current and prospective customers, creating a comprehensive property and resident management platform. Additional information regarding the acquisition is available on the Investor Relations section of SmartRent’s website at www.smartrent.com.
2
Key Operating Metrics(1)
SmartRent set company records for both the quarter and the year for Units Booked and Units Deployed. Units Deployed in the fourth quarter increased 72% to 52,076 from the fourth quarter of 2020. For the full year, Units Deployed increased by 101% to 167,743 from 83,293 in 2020. Total Units Deployed at year-end were 339,485, comprising 322,848 from SmartRent’s customer base and 16,637 units that were part of the iQuue acquisition completed on December 30, 2021.
Units Booked in the fourth quarter of 2021 increased 42% to 84,052 from 59,067 in the fourth quarter of 2020. For the full year, Units Booked increased 94% to 218,106 as compared to 112,555 for 2020. The Units Booked in 2021 had an average SaaS ARPU of $3.82, up 11% from $3.45 in SaaS ARPU for Units Booked in 2020. Growth in SaaS ARPU was primarily driven by the Company’s ability to improve its pricing model with the continued diversification of its customer base.
Bookings, which represent the value of Booked Units from Hardware, Professional Services and Hubs, as well as one year of SaaS, increased 10% for the fourth quarter to approximately $67.6 million and 80% to approximately $170.1 million for the year.
Committed Units in the fourth quarter, including Committed Units acquired with iQuue, increased 5% to 742,429 on a sequential quarter basis and are up 23% since the first quarter of 2021, when the Company began tracking Committed Units as a key performance indicator. In the fourth quarter, aggregate Deployed and Committed Units increased sequentially from the third quarter of 2021 by 11% to 1,081,914, including 22,605 aggregate Deployed and Committed Units gained in the iQuue acquisition.
SmartRent’s customer base grew at a record pace in 2021, both for the fourth quarter and the full year. During the fourth quarter, SmartRent added 31 new customers and gained 19 additional customers through its acquisition of iQuue, bringing SmartRent’s total customer base to 249.
For the year, SmartRent grew its customer base 75%, from 142 customers at the end of 2020. Collectively, the Company’s 249 customers own or operate approximately 4.5 million units.
Recent Business Highlights
In December 2021, SmartRent acquired iQuue, an open-architecture smart apartment company with 16,637 Units Deployed and 5,968 Committed Units primarily located throughout the East Coast. The acquisition provides SmartRent incremental exposure in the new-build multifamily market and expands SmartRent’s presence in the Southeast by adding 19 new customers who own or control approximately 100,000 units. We anticipate iQuue will contribute approximately $2.0 million in annual recurring revenue (ARR) in 2022. The transaction closed on December 30, 2021 and did not contribute to SmartRent’s fourth quarter revenue. Additional details regarding the acquisition are available in the Company’s 2021 Annual Report on Form 10-K.
In January 2022, SmartRent announced the appointment of Brian Roberts as Chief Legal Officer. Mr. Roberts, an experienced public-company executive with over 20 years of corporate legal experience, oversees all legal, corporate governance and compliance matters for the Company.
Balance Sheet and Liquidity
As of December 31, 2021, the Company had $432.6 million in cash on its balance sheet as compared to $38.6 million as of December 31, 2020. The increase in cash reflects the capital raised from SmartRent’s financing and public listing on NYSE in August 2021. The Company ended the year with approximately $95.6 million of deferred revenue on its balance sheet, as compared to approximately $53.5 million at the end of 2020, reflecting growth in the Company’s Deployed Units.
In December 2021, SmartRent entered into a $75.0 million senior secured revolving credit facility with a five-year term and a provision for an incremental $75.0 million subject to certain conditions. The revolving facility was unused as of December 31, 2021. The Company also retired a $4.9 million term loan with its available cash. As of December 31,
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2021, the Company has no outstanding debt and approximately $507.6 million in liquidity including availability under its revolving credit facility and cash on the balance sheet.
Financial and Business Outlook
The Company continues to experience strong demand for its smart home enterprise software solutions and is providing guidance for full-year 2022 and the first quarter of 2022.
The estimates presented below represent a range of possible outcomes and may differ materially from actual results. These estimates exclude the impact of potential acquisitions, capital markets activity, and unforeseen potential challenges with supply chain and logistics. The estimates are forward-looking based on the Company’s current assessment of demand for its product, execution capabilities and market conditions, as well as other risks outlined below under the caption “Forward-Looking Statements.”
Full-Year 2022 Guidance
Quarter ended March 31, 2022 Guidance
Definitions of non-GAAP financial measures and the reconciliations to the most directly comparable GAAP measures are provided in subsequent sections of the press release and supplemental schedules. SmartRent has not provided a reconciliation of forward-looking Adjusted EBITDA, including certain components of the forward-looking reconciliation to the most directly comparable GAAP financial measures, due primarily to variability and difficulty in making accurate forecasts and projections of non-operating matters that may arise, as not all of the information necessary for a quantitative reconciliation is available to SmartRent without unreasonable effort. For the same reasons, SmartRent is unable to address the probable significance of the information.
Conference Call Information
SmartRent is hosting a conference call today, March 24, 2022, at 5 p.m. ET to discuss its fourth quarter and full-year 2021 financial results. To join the call, dial 1-877-407-3982 in the USA or Canada, or 1-201-493-6780 if dialing in internationally. The passcode for the conference call is 13726960.
Following the call’s conclusion, a webcast of the call will be posted on the Events and Presentations section of SmartRent’s website.
About SmartRent
Founded in 2017, SmartRent (NYSE: SMRT) is an enterprise smart home and smart building technology platform for property owners, managers, developers, homebuilders and residents. The SmartRent solution is designed to provide property managers with seamless visibility and control over all their assets while delivering cost savings and additional revenue opportunities through all-in-one home control offerings for residents. For more information, please visit smartrent.com.
Forward-Looking Statements
This press release contains forward-looking statements which address the Company's expected future business and financial performance, and may contain words such as "goal," "target," "future," "estimate," "expect," "anticipate," "intend," "plan," "believe," "seek," "project," "may," "should," "will" or similar expressions. Examples of forward-looking statements include, among others, statements regarding the benefits of the Company's strategic acquisitions, changes in the market for our products and services, expected financial results, product portfolio enhancements, expansion plans and opportunities and earnings guidance related to 2022 financial and operational metrics. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those currently anticipated. Some of the factors that could cause actual results to differ materially from those expressed or implied by
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the forward-looking statements include, among other things, our ability to: (1) execute our business strategy within the smart home technology industry; (2) expand our products and solutions to meet the demands of the market; (3) meet legal obligations, including laws and regulations related to security and privacy; (4) prevent unauthorized or inadvertent access to our information technology systems and customer or resident data; (5) successfully manage the competitiveness of our market and pricing levels of our competitors; (6) hire, retain, manage and motivate employees, including key personnel; (7) successfully manage and ensure that our suppliers produce or obtain quality products and services on a timely basis or in sufficient quantity; (8) successfully manage interruptions to, or other problems with, our website and interactive user interface, information technology systems, manufacturing processes or other operations; (9) successfully identify, acquire, and integrate quality acquisition targets; (10) successfully resolve legal proceedings, recall claims, and governmental inquiries; (11) acquire and protect our intellectual property and acquire or make investments in other businesses, patents, technologies, products or services to grow the business; (12) comply with laws and regulations applicable to our business, including developments in state and local regulations; (13) fuel growth and accelerate the adoption of our products and services; (14) develop, design, and sell services that are differentiated from those of competitors; (15) manage risks associated with product liability, warranty, personal injury, property damage and recall matters; and (16) successfully deploy the proceeds from the business combination we completed last year. The forward-looking statements herein represent the judgment of the Company, as of the date of this release, and SmartRent disclaims any intent or obligation to update forward-looking statements. This press release should be read in conjunction with the information included in the Company's other press releases, reports and other filings with the SEC. Understanding the information contained in these filings is important in order to fully understand the Company's reported financial results and our business outlook for future periods.
Use of Non-GAAP Financial Measures
In addition to disclosing financial results that are determined in accordance with GAAP, SmartRent also discloses certain non-GAAP financial measures in this press release. These financial measures are not recognized measures under GAAP and should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. EBITDA and Adjusted EBITDA are non-GAAP financial measures as defined by SEC rules. These non-GAAP financial measures, as defined below by SmartRent, may be determined or calculated differently by other companies. Reconciliations of these non-GAAP measurements to the most directly comparable GAAP financial measurements have been provided in the financial statement tables included in this press release, and investors are encouraged to review the reconciliations.
As detailed in the reconciliations, the GAAP measure most directly comparable to EBITDA and Adjusted EBITDA is net income or loss. EBITDA and Adjusted EBITDA are not used as measures of SmartRent’s liquidity and should not be considered alternatives to net income or loss or any other measure of financial performance presented in accordance with GAAP.
SmartRent’s management uses EBITDA and Adjusted EBITDA in a number of ways to assess the Company’s financial and operating performance and believes that these measures provide useful information to investors regarding financial and business trends related to SmartRent’s results of operations. EBITDA and Adjusted EBITDA are also used to identify certain expenses and make decisions designed to help SmartRent meet its current financial goals and optimize its financial performance, while neutralizing the impact of expenses included in its operating results which could otherwise mask underlying trends in its business. SmartRent’s management believes that investors are provided with a more meaningful understanding of SmartRent’s ongoing operating performance when non-GAAP financial information is viewed with GAAP financial information.
SmartRent regularly monitors several operating and financial metrics including the following non-GAAP financial measures which the Company believes are key measures of its growth, to evaluate its operating performance, identify trends affecting its business, formulate business plans, measure its progress, and make strategic decisions. The Company’s Key Operating Metrics may not provide accurate predictions of future GAAP financial results.
Units Deployed is defined as the aggregate number of SmartHubs that have been installed (also including customer self-installations) as of a stated measurement date. The Company uses this operating metric to assess the general health and trajectory of its business growth.
5
New Units Deployed is defined as the aggregate number of SmartHubs that have been installed (also including customer self-installations) during a stated measurement period. The Company uses this operating metric to assess the general health and trajectory of its business growth.
Committed Units is defined as the aggregate number of SmartHub units that are subject to binding orders from customers together with units that existing customers who are parties to a SmartRent master services agreement have informed us (on a non-binding basis) that they intend to order in the future for deployment within two years of the measurement date. The Company tracks the number of Committed Units to assess the general health and trajectory of its business and to assist in its longer-term resource analysis.
Units Booked is defined as the aggregate number of SmartHubs associated with binding orders executed during a stated measurement period. The Company utilizes the concept of Units Booked to measure estimated near-term resource demand and the resulting approximate range of post-delivery revenue that it will earn and record. Units Booked represent binding orders only and accordingly are a subset of Committed Units.
Annual Recurring Revenue (“ARR”) is defined as the annualized value of our recurring SaaS revenue earned in the current quarter.
EBITDA and Adjusted EBITDA: We define EBITDA as net income or loss computed in accordance with GAAP before the following items: interest expense, income tax expense and depreciation and amortization. We define Adjusted EBITDA as EBITDA before the following items: stock-based compensation expense, non-employee warrant expense, loss on extinguishment of debt, change in fair value of derivatives, unrealized gains and losses in currency exchange rates, and warranty provisions for battery deficiencies. Management uses EBITDA and Adjusted EBITDA to identify certain expenses and make decisions designed to help us meet our current financial goals and optimize our financial performance, while neutralizing the impact of expenses included in our operating results which could otherwise mask underlying trends in our business. See “Use of Non-GAAP Financial Measures” for additional information and reconciliation of these measures.
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SMARTRENT, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
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For the quarters ended December 31, |
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For the years ended December 31, |
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2021 |
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2020 |
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2021 |
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2020 |
Revenue |
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Hardware |
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$ 21,177 |
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$ 8,022 |
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$ 69,629 |
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$ 31,978 |
Professional services |
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7,387 |
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2,746 |
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22,732 |
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12,304 |
Hosted services |
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6,104 |
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2,833 |
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18,276 |
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8,252 |
Total revenue |
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34,668 |
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13,601 |
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110,637 |
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52,534 |
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Cost of revenue |
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Hardware |
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21,226 |
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10,234 |
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70,448 |
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35,225 |
Professional services |
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12,340 |
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4,585 |
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38,189 |
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16,176 |
Hosted services |
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4,256 |
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1,695 |
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12,073 |
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5,430 |
Total cost of revenue |
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37,822 |
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16,514 |
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120,710 |
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56,831 |
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Operating expense |
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Research and development |
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7,515 |
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2,765 |
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21,572 |
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9,406 |
Sales and marketing |
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4,923 |
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1,381 |
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14,017 |
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5,429 |
General and administrative |
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10,317 |
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3,825 |
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25,990 |
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16,584 |
Total operating expense |
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22,755 |
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7,971 |
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61,579 |
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31,419 |
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Loss from operations |
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(25,909) |
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(10,884) |
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(71,652) |
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(35,716) |
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Interest expense, net |
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(50) |
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(49) |
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(249) |
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(559) |
Other income (expense), net |
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(14) |
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224 |
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55 |
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(685) |
Loss before income taxes |
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(25,973) |
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(10,709) |
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(71,846) |
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(36,960) |
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Provision for income taxes |
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(15) |
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(21) |
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115 |
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149 |
Net loss |
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(25,958) |
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(10,688) |
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(71,961) |
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(37,109) |
Other comprehensive loss |
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Foreign currency translation adjustment |
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(92) |
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103 |
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(226) |
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235 |
Comprehensive loss |
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$ (26,050) |
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$ (10,585) |
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$ (72,187) |
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$ (36,874) |
Net loss per common share |
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Basic and diluted |
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$ (0.13) |
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$ (1.03) |
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$ (0.96) |
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$ (4.32) |
Weighted-average number of shares used in computing net loss per share |
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Basic and diluted |
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192,053 |
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10,378 |
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74,721 |
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8,598 |
7
SMARTRENT, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share amounts)
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December 31, 2021 |
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December 31, 2020 |
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ASSETS |
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Current assets |
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Cash and cash equivalents |
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$ |
430,841 |
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$ |
38,618 |
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Restricted cash, current portion |
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1,268 |
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- |
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Accounts receivable, net |
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45,486 |
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20,787 |
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Inventory |
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33,208 |
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17,628 |
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Deferred cost of revenue, current portion |
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7,835 |
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6,782 |
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Prepaid expenses and other current assets |
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17,369 |
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3,840 |
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Total current assets |
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536,007 |
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87,655 |
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Property and equipment, net |
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1,874 |
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847 |
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Deferred cost of revenue |
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18,334 |
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10,072 |
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Goodwill |
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12,666 |
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4,162 |
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Other long-term assets |
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10,802 |
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|
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1,113 |
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Total assets |
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$ |
579,683 |
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$ |
103,849 |
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LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) |
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Current liabilities |
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Accounts payable |
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$ |
6,149 |
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$ |
2,275 |
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Accrued expenses and other current liabilities |
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22,234 |
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|
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9,555 |
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Deferred revenue, current portion |
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42,185 |
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19,348 |
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Current portion of long-term debt |
|
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- |
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|
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1,651 |
|
Total current liabilities |
|
|
70,568 |
|
|
|
32,829 |
|
Long-term debt, net |
|
|
- |
|
|
|
3,169 |
|
Deferred revenue |
|
|
53,412 |
|
|
|
34,153 |
|
Other long-term liabilities |
|
|
6,201 |
|
|
|
516 |
|
Total liabilities |
|
|
130,181 |
|
|
|
70,667 |
|
|
|
|
|
|
|
|
||
Commitments and contingencies (Note 12) |
|
|
|
|
|
|
||
Convertible preferred stock, $0.0001 par value; 50,000 and 105,995 shares authorized as of December 31, 2021 and December 31, 2020; no shares of preferred stock issued and outstanding as of December 31, 2021; 104,822 shares issued and outstanding as of December 31, 2020. |
|
|
- |
|
|
|
111,432 |
|
|
|
|
|
|
|
|
||
Stockholders' equity (deficit) |
|
|
|
|
|
|
||
Common stock, $0.0001 par value; 500,000 and 140,595 shares authorized as of December 31, 2021 and December 31, 2020; 193,864 and 10,376 shares issued and outstanding as of December 31, 2021 and December 31, 2020 |
|
|
19 |
|
|
|
- |
|
Additional paid-in capital |
|
|
604,077 |
|
|
|
4,157 |
|
Accumulated deficit |
|
|
(154,603 |
) |
|
|
(82,642 |
) |
Accumulated other comprehensive income |
|
|
9 |
|
|
|
235 |
|
Total stockholders' equity (deficit) |
|
|
449,502 |
|
|
|
(78,250 |
) |
Total liabilities, convertible preferred stock and stockholders' equity (deficit) |
|
$ |
579,683 |
|
|
$ |
103,849 |
|
8
SMARTRENT, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
|
|
For the years ended December 31, |
|
|||||
|
|
2021 |
|
|
2020 |
|
||
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
|
||
Net loss |
|
$ |
(71,961 |
) |
|
$ |
(37,109 |
) |
Adjustments to reconcile net loss to net cash used by operating activities |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
463 |
|
|
|
295 |
|
Amortization of debt discount |
|
|
14 |
|
|
|
8 |
|
Non-employee warrant expense |
|
|
931 |
|
|
|
481 |
|
Provision for warranty expense |
|
|
7,634 |
|
|
|
3,370 |
|
Loss on extinguishment of debt |
|
|
27 |
|
|
|
164 |
|
Non-cash lease expense |
|
|
621 |
|
|
|
461 |
|
Stock-based compensation related to acquisition |
|
|
812 |
|
|
|
707 |
|
Stock-based compensation |
|
|
7,319 |
|
|
|
1,052 |
|
Compensation expense related to acquisition |
|
|
- |
|
|
|
3,353 |
|
Non-cash interest expense |
|
|
11 |
|
|
|
100 |
|
Provision for excess and obsolete inventory |
|
|
(39 |
) |
|
|
778 |
|
Provision for doubtful accounts |
|
|
226 |
|
|
|
512 |
|
Change in operating assets and liabilities |
|
|
|
|
|
|
||
Accounts receivable |
|
|
(23,969 |
) |
|
|
(13,526 |
) |
Inventory |
|
|
(15,778 |
) |
|
|
(11,090 |
) |
Deferred cost of revenue |
|
|
(9,315 |
) |
|
|
(8,584 |
) |
Prepaid expenses and other assets |
|
|
(11,284 |
) |
|
|
1,014 |
|
Accounts payable |
|
|
3,811 |
|
|
|
(72 |
) |
Accrued expenses and other liabilities |
|
|
1,605 |
|
|
|
(3,209 |
) |
Deferred revenue |
|
|
38,945 |
|
|
|
32,841 |
|
Lease liabilities |
|
|
(449 |
) |
|
|
(36 |
) |
Net cash used in operating activities |
|
|
(70,376 |
) |
|
|
(28,490 |
) |
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
|
|
||
Payments for Zenith acquisition, net of cash acquired |
|
|
- |
|
|
|
(2,382 |
) |
Payments for iQuue acquisition, net of cash acquired |
|
|
(5,902 |
) |
|
|
- |
|
Purchase of property and equipment |
|
|
(1,471 |
) |
|
|
(298 |
) |
Payment for loan receivable |
|
|
(2,000 |
) |
|
|
- |
|
Net cash used in investing activities |
|
|
(9,373 |
) |
|
|
(2,680 |
) |
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
|
||
Proceeds from revolving line of credit |
|
|
- |
|
|
|
7,179 |
|
Payments on revolving line of credit |
|
|
- |
|
|
|
(11,981 |
) |
Payments on term loan |
|
|
(4,861 |
) |
|
|
(139 |
) |
Payments of senior revolving facility transaction costs |
|
|
(658 |
) |
|
|
- |
|
Payments on note payable related to acquisition |
|
|
- |
|
|
|
(4,327 |
) |
Proceeds from warrant exercise |
|
|
5 |
|
|
|
- |
|
Proceeds from convertible notes |
|
|
- |
|
|
|
50 |
|
Convertible preferred stock issued |
|
|
35,000 |
|
|
|
57,500 |
|
Payments of convertible preferred stock transaction costs |
|
|
(207 |
) |
|
|
(61 |
) |
Proceeds from business combination and private offering |
|
|
500,628 |
|
|
|
- |
|
Payments of business combination and private offering transaction costs |
|
|
(55,981 |
) |
|
|
- |
|
Net cash provided by financing activities |
|
|
473,926 |
|
|
|
48,221 |
|
Effect of exchange rate changes on cash and cash equivalents |
|
|
(191 |
) |
|
|
143 |
|
Net increase in cash, cash equivalents, and restricted cash |
|
|
393,986 |
|
|
|
17,194 |
|
Cash, cash equivalents, and restricted cash - beginning of period |
|
|
38,618 |
|
|
|
21,424 |
|
Cash, cash equivalents, and restricted cash - end of period |
|
$ |
432,604 |
|
|
$ |
38,618 |
|
|
|
|
|
|
|
|
||
Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
430,841 |
|
|
$ |
38,618 |
|
Restricted cash, current portion |
|
|
1,268 |
|
|
|
- |
|
Restricted cash, included in other long-term assets |
|
|
495 |
|
|
|
- |
|
Total cash, cash equivalents, and restricted cash |
|
$ |
432,604 |
|
|
$ |
38,618 |
|
9
SMARTRENT, INC.
RECONCILIATION OF NON-GAAP MEASURES
(In thousands)
|
Years ended December 31, |
|
|||||
|
2021 |
|
|
2020 |
|
||
Net loss |
$ |
(71,961 |
) |
|
$ |
(37,109 |
) |
Interest expense, net |
|
249 |
|
|
|
559 |
|
Provision for income taxes |
|
115 |
|
|
|
149 |
|
Depreciation and amortization |
|
463 |
|
|
|
295 |
|
EBITDA |
|
(71,134 |
) |
|
|
(36,106 |
) |
Stock-based compensation |
|
8,131 |
|
|
|
1,759 |
|
Non-employee warrant expense |
|
931 |
|
|
|
481 |
|
Loss on extinguishment of debt |
|
27 |
|
|
|
164 |
|
Loss on change in exchange rates |
|
- |
|
|
|
470 |
|
Compensation expense in connection with Zenith acquisition |
|
- |
|
|
|
3,353 |
|
Warranty provision for battery deficiencies |
|
6,430 |
|
|
|
3,200 |
|
Adjusted EBITDA |
$ |
(55,615 |
) |
|
$ |
(26,679 |
) |
Investor Contact
Evelyn León Infurna – SVP, Investor Relations
Phone: 480-371-2828
Email: [email protected]
Media Contact
Amanda Chavez – Director, Corporate Communications
Phone: 480-805-9811
Email: [email protected]
10
|
Exhibit 99.2 |
SmartRent Acquires SightPlan, a Leading SaaS Provider of Property Operating Solutions
Strategic acquisition advances SmartRent’s product roadmap and is
expected to contribute approximately $10 million of SaaS revenue in 2022
Scottsdale, Ariz., March 24, 2022 – (BUSINESS WIRE) – SmartRent, Inc. (NYSE: SMRT) (“SmartRent” or the “Company”), a leading provider of smart home and smart building automation for residents, property owners, managers, developers and homebuilders, today announced the acquisition of SightPlan, Inc. (“SightPlan”), a leader in multifamily workflow management. The acquisition advances SmartRent’s product roadmap and augments the breadth of cloud-based SaaS solutions for current and prospective customers, creating a comprehensive property and resident management platform.
“We are excited about bringing SightPlan on to the SmartRent platform; the alignment of our open-API solutions creates a powerful combination for real estate operators,” said Lucas Haldeman, CEO of SmartRent. “Our organizations share similar values and have a deep passion for helping people live easier, better lives. Combining our highly complementary product offerings enables us to deliver enhanced experiences for residents, property owners, and managers, and increases our competitive advantage. We know the SightPlan team well and are excited to welcome them to the SmartRent family.”
SightPlan Overview
SightPlan, founded in 2013, is a growing and differentiated vertical SaaS provider. It’s an innovative end-to-end, top-to-bottom real estate operating platform that automates communications, resident engagement, field services and maintenance workflow, inspections, due diligence and audit management for real estate owners and operators. These solutions empower customers to:
SightPlan is targeting a large addressable market by providing modern, easy-to-use software to real estate operators and managers. The technology solves common issues and enables customers to get more done with greater efficiency. SightPlan replaces manual processes, time-consuming spreadsheets, point solutions and closed property management systems associated with community and portfolio workflow operations.
SightPlan provides solutions services for more than 160 real estate owners and managers. The company’s offerings are in use at nearly 6,000 properties nationwide, including communities from four of the top five largest owners on the 2021 National Multifamily Housing Council’s (NMHC) Top Owners List, and more than half of those included on the NMHC Top Managers List. Like SmartRent, SightPlan is led by an experienced team of technology and real estate leaders.
Strategic Rationale
“We’ve had a strong working relationship with the SmartRent team for years and have a tremendous amount of respect for all they have accomplished as the industry leader in enterprise real estate technology,” said Terry Danner, CEO of SightPlan. “When we looked at the value combining our
teams, our innovations, and our strategies would bring to the real estate industry at large, it became a must-do. We are excited for all that we will be able to accomplish as one team.”
“Together, we have an opportunity to increase the positive impact we make in the enterprise real estate technology space,” said Joseph Westlake, Founder and President of SightPlan. “Combining our solutions further enhances our ability to improve the lives of residents, owners, operators, managers, developers and homebuilders.”
Transaction Highlights
SmartRent acquired 100% of the equity interests of SightPlan on March 22, 2022, for approximately $135 million in an all-cash transaction. The SightPlan team will join SmartRent as employees, and SightPlan will continue to run its operations from its Orlando, Florida office.
SightPlan’s customer subscriptions are expected to add approximately $10 million to SmartRent’s SaaS revenue for 2022. Software Equity Group (SEG) served as the exclusive advisor to SightPlan on the transaction.
About SmartRent
Founded in 2017, SmartRent (NYSE: SMRT) is an enterprise smart home and smart building technology platform for property owners, managers, and residents. The SmartRent solution is designed to provide property managers with seamless visibility and control over all their assets while delivering cost savings and additional revenue opportunities through all-in-one home control offerings for residents. For more information, please visit smartrent.com.
About SightPlan
SightPlan provides software solutions to help apartment communities optimize operations while improving resident satisfaction. We believe that Great Teams = Great Communities, so we're empowering leasing, resident service, and maintenance team members with easy-to-use solutions to deliver exceptional service. To learn more about our innovative solutions, visit us at www.sightplan.com.
Forward-Looking Statements
SmartRent cautions you that statements in this press release that are not a description of historical facts are forward-looking statements. These statements are based on the Company's current beliefs and expectations. The inclusion of forward-looking statements should not be regarded as a representation by SmartRent that any of its plans will be achieved. Actual results may differ from those set forth in this press release due to the risk and uncertainties inherent in the Company’s business, including, without limitation: the successful integration of SightPlan into SmartRent, the expectation that SightPlan will add approximately $10 million to SmartRent’s SaaS revenue for 2022; expectations regarding demand for the Company and SightPlan’s software products and related services; unanticipated supply chain impacts; estimations regarding demand for SmartRent and SightPlan’s products and services; and other risks described in the Company's prior press releases and in the Company's filings with the Securities and Exchange Commission ("SEC"). You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and the Company undertakes no obligation to revise or update this press release to reflect events or circumstances after the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement, which is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
Investor Contact
Evelyn León Infurna – SVP, Investor Relations
Phone: 480-371-2828
Email: [email protected]
Media Contact
Amanda Chavez – Director, Corporate Communications
Phone: 480-805-9811
Email: [email protected]