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Year To Date Q3 2024 Highlights:

• Revenue - Total revenue was $21,602,000, a 16% decrease from $25,839,000 during the first nine months of 2023. Communications revenue decreased 9% from the first nine months of 2023. The decrease is primarily related to a decrease in volume and pricing from our Newswire news distribution brand. Communications revenue was 78% of total revenue for the first nine months of 2024 compared to 72% for the same period of 2023. Compliance revenue decreased 35% from the first nine months of 2023. The decrease is primarily due to a decline in revenue from our print and proxy fulfillment services due to a few one-time, significant transactions which occurred during the nine months ended September 30, 2023, which did not occur in the current year. Additionally, we experienced a decrease in revenue from our disclosure services and transfer agent services due to a decrease in corporate actions and directives during the period .

• Gross Margin - Gross margin for the first nine months of 2024 was $16,136,000, or 75% of revenue, compared to $19,877,000, or 77% of revenue, during the first nine months of 2023. Communications gross margin was 76% for the first nine months of 2024 compared to 78% for the same period of the prior year.

• Operating Income -Operating income was $438,000 for the first nine months of 2024, compared to operating income of $2,921,000 during the first nine months of 2023. The decrease in operating income was primarily due to the decrease in revenue and gross margin noted earlier, partially offset by a decrease in operating expenses.

• Net (Loss) Income -On a GAAP basis, net loss was $(598,000), or $(0.16) per diluted share during the first nine months of 2024, compared to net income of $1,492,000, or $0.39 per diluted share during the first nine months of 2023.

• Operating Cash Flows - Cash flows from operations for the first nine months of 2024 were $2,294,000 compared to $2,290,000 during the same period of 2023.

• Non-GAAP Measures -EBITDA for the first nine months of 2024 was $2,631,000, or 12% of revenue, compared to $5,147,000, or 20% of revenue, during the first nine months of 2023. Adjusted EBITDA was $3,585,000, or 17% of revenue, for the first nine months of 2024 compared to $6,663,000, or 26% of revenue, for the first nine months of 2023. Non-GAAP net income for the first nine months of 2024 was $1,809,000, or $0.47 per diluted share, compared to $4,314,000, or $1.13 per diluted share, during the first nine months of 2023. Adjusted free-cash flow was $1,860,000 for the first nine months of 2024 compared to $2,638,000 for the first nine months of 2023.

Key Performance Indicators:

• As of September 30, 2024, we had 12,505 customers who had an active contract during the past twelve months, compared to 12,171 as of September 30, 2023.

• During the quarter, the Company had 1,121 subscriptions to our products, compared to 1,050 subscriptions during the same period last year. The Company defines a subscription as any customer who enters into a contract for a minimum of one year for one or more products.

Non-GAAP Information

Certain Non-GAAP financial measures are included in this press release. In the calculation of these measures, the Company excludes certain items, such as amortization of intangible assets, stock-based compensation, tax impact of adjustments, other unusual items and discrete items impacting income tax expense. The Company believes that excluding such items provides investors and management with a representation of the Company's core operating performance and with information useful in assessing its prospects for the future and underlying trends in the Company's operating expenditures and continuing operations. Management uses such Non-GAAP measures to evaluate financial results and manage operations. The release and the attachments to this release provide a reconciliation of each of the Non-GAAP measures referred to in this release to the most directly comparable GAAP measure. The Non-GAAP financial measures are not meant to be considered a substitute for the corresponding GAAP financial statements and investors should evaluate them carefully. These Non-GAAP financial measures may differ materially from the Non-GAAP financial measures used by other companies.

RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES
(in thousands, except per share amounts)
CALCULATION OF EBITDA & ADJUSTED EBITDA

(1) This adjustment gives effect to one-time corporate projects, including acquisition and/or integration related expenses, incurred during the periods.

(2) For the three and nine months ended September 30, 2024, this adjustment gives effect to a loss recorded on the change in fair value of our interest rate swap of $343,000 and $124,000, as well as, one-time accounting fees, termination benefits and other non-recurring or unusual expenses of $125,000 and $212,000, respectively. For the three months ended September 30, 2023, this adjustment gives effect to a gain recorded on the change in fair value of our interest rate swap of $165,000, partially offset by one-time, non-recurring expenses of $45,000. For the nine months ended September 30, 2023, this adjustment gives effect to $370,000 payment related to early extinguishment of our Seller Note and one-time non-recurring expenses of $45,000, partially offset by a gain recorded on the change in fair value of our interest rate swap of $379,000.

(3) The adjustments represent stock-based compensation expense related to awards of stock options, restricted stock units, or common stock in exchange for services. Although we expect to continue to award stock in exchange for services, the amount of stock-based compensation is excluded as it is subject to change as a result of one-time or non-recurring projects.

CALCULATION OF NON-GAAP NET INCOME

(1) The adjustments represent the amortization of intangible assets related to acquired assets and companies.

(2) The adjustments represent stock-based compensation expense related to awards of stock options, restricted stock units, or common stock in exchange for services. Although we expect to continue to award stock in exchange for services, the amount of stock-based compensation is excluded as it is subject to change as a result of one-time or non-recurring projects.

(3) For the three and nine months ended September 30, 2024, this adjustment gives effect to a loss recorded on the change in fair value of our interest rate swap of $343,000 and $124,000, as well as, one-time accounting fees, termination benefits and other non-recurring or unusual expenses, including acquisition and integration expenses of $168,000 and $362,000, respectively. For the three months ended September 30, 2023, this adjustment gives effect to a gain recorded on the change in fair value of our interest rate swap of $165,000, partially offset by one-time, non-recurring expenses, including acquisition and/or integration expenses of $59,000. For the nine months ended September 30, 2023, this adjustment gives effect to one-time, non-recurring expenses, including acquisition and/or integration expenses of $430,000 and a $370,000 payment related to early extinguishment of our Seller Note and one-time non-recurring expenses of $45,000, partially offset by a gain recorded on the change in fair value of our interest rate swap of $379,000.

(4) This adjustment eliminates discrete items impacting income tax expense. For the three and nine months ended September 30, 2024, discrete items relate to additional income tax expense (benefit) recorded during the period related to the exercise of stock compensation of ($46,000) and $39,000, respectively, and a benefit related to a return to provision adjustment of ($25,000) for both periods. There were no discrete items impacting income tax for the three and nine months ended September 30, 2023.

(5) This adjustment gives effect to the tax impact of all non-GAAP adjustments at the current Federal tax rate of 21%.

CALCULATION OF FREE CASH FLOW AND ADJUSTED FREE CASH FLOW

(1) This adjustment gives effect to one-time corporate projects, including acquisition and/or integration related expenses, paid during the periods.

(2) For the three and nine months ended September 30, 2024, this adjustment gives effect to payments for one-time accounting fees, termination benefits and other non-recurring or unusual expenses. During the nine months ended September 30, 2023, this adjustment is primarily related to a one-time payment of $370,000 related to the early termination of the note payable associated with the Newswire acquisition.

Conference Call Information

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Conference Call Replay Information

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About Issuer Direct Corporation

Issuer Direct^® is a leading communications and compliance company, providing solutions for both Public Relations and Investor Relations Professionals for over 18 years. Our comprehensive solutions are used by thousands of customers from emerging startups to multi-billion dollar global brands, ensuring their most important moments are reaching the right audiences, via our industry leading newswire, IR website solutions, events technology, and compliance solutions. For more information, please visit www.issuerdirect.com.

Forward-Looking Statements

This press release contains "forward-looking statements" 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 (the "Exchange Act") (which Sections were adopted as part of the Private Securities Litigation Reform Act of 1995). Statements preceded by, followed by or that otherwise include the words "believe," "anticipate," "estimate," "expect," "goal," "intend," "plan," "project," "prospects," "outlook," and similar words or expressions, or future or conditional verbs, such as "will," "should," "would," "may," and "could," are generally forward-looking in nature and not historical facts. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the Company's actual results, performance, or achievements to be materially different from any anticipated results, performance, or achievements for many reasons. The Company disclaims any intention to, and undertakes no obligation to, revise any forward-looking statements, whether as a result of new information, a future event, or otherwise. For additional risks and uncertainties that could impact the Company's forward-looking statements, please see the Company's Annual Report on Form 10-K for the year ended December 31, 2023, including but not limited to the discussion under "Risk Factors" therein, which the Company filed with the SEC and which may be viewed at http://www.sec.gov/.

For Further Information:

Issuer Direct Corporation
Brian R. Balbirnie
(919)-481-4000
brian.balbirnie@issuerdirect.com

Hayden IR
Brett Maas
(646)-536-7331
brett@haydenir.com

Hayden IR
James Carbonara
(646)-755-7412
james@haydenir.com

ISSUER DIRECT CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)

ISSUER DIRECT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(in thousands, except share and per share amounts)

ISSUER DIRECT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(in thousands)

SOURCE: Issuer Direct Corporation