Exhibit 99.1

 

LOGO

Kaleyra Announces Second Quarter Financial Results

Total second quarter revenue of $54.0 million, up 73% from the same period a year ago

Largest year-over-year gross profit increase as a public company, up 140% versus Q2 2020

Delivered 8.5 billion billable messages and connected 1.4 billion voice calls

Closed Landmark Acquisition of Messaging Solution Provider mGage along with strategic capital raise

Acquired Bandyer to Expand Communication Solutions to include Programmable Video APIs

New York and Vienna, VA – August 9, 2021 - Kaleyra, Inc. (NYSE: KLR) (KLR WS) (“Kaleyra” or the “Company”), a rapidly growing cloud communications software provider delivering a secure system of application programming interfaces (APIs) and connectivity solutions in the API/Communications Platform as a Service (CPaaS) market, today announced financial results for the second quarter ended June 30, 2021.

“Kaleyra reported another strong quarter, with Q2 exceeding our revenue expectations along with significant improvement in our gross margins. The team has continued to execute very well through the closing of the mGage transaction as well as another challenging period as the delta variant of COVID makes a resurgence,” commented Dario Calogero, Kaleyra’s Founder and Chief Executive Officer. “The second quarter was transformational for Kaleyra as we completed the landmark acquisition of mGage as well as, immediately following the closing of the second quarter, acquiring Bandyer. Through these acquisitions we have accelerated our growth, expanded our geographic reach and broadened our product portfolio. We have already merged the mGage team into the Kaleyra family and are pleased by the seamless integration. The strength of our business and the team executing it give us confidence in our ability to maintain momentum for the remainder of 2021 and support our vision as a global CPaaS platform.”

Second Quarter 2021 Financial Highlights

 

   

Revenue: Total revenue for the second quarter of 2021 was $54.0 million, a 73% increase when compared to $31.2 million in the second quarter of 2020. During the one month that it was part of Kaleyra, mGage contributed $10.2 million in the second quarter revenue.

 

   

Gross Profit: Gross profit for the second quarter of 2021 was $10.5 million, a 140% increase when compared to $4.4 million for the second quarter of 2020, and our largest year-over-year gross profit increase as a public company. Gross margin for the second quarter of 2021 was 19% versus 14% in the second quarter of 2020.

 

   

Adjusted Gross Profit: Adjusted gross profit for the second quarter of 2021 was $11.1 million, a 147% increase when compared to $4.5 million for the second quarter of 2020. Adjusted gross margin for the second quarter of 2021 was 21% versus 14% in the second quarter of 2020. The main drivers of the gross margin increase were the organic expansion of gross profitability for Kaleyra legacy businesses, representing 81% of the year-over-year increase, and the revised product mix due to the acquisition of mGage.

 

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Net Loss: Net loss for the second quarter of 2021 was $(4.5) million, or $(0.13) per share, based on 34.3 million weighted-average shares outstanding, predominantly due to one-time expenses pertaining to the mGage acquisition and non-cash stock-based compensation expenses. During the second quarter of 2020, net loss was $(8.1) million, or $(0.39) per share, based on 20.6 million weighted-average shares outstanding.

 

   

Adjusted Net Income (Loss): Adjusted net income for the second quarter of 2021 was $0.5 million, or $0.01 per share basic and diluted, based on 34.3 million weighted-average shares outstanding basic and 44.9 million diluted, compared to adjusted net loss of $(1.4) million, or $(0.07) per share, based on 20.6 million weighted-average shares outstanding in the second quarter of 2020.

 

   

Adjusted EBITDA: Adjusted EBITDA was $2.2 million for the second quarter of 2021, compared to a loss $(0.3) million for the second quarter of 2020. Kaleyra continues to strongly invest in human capital, and in particular, in research and development talent, enhancing the head count growth year over year to strengthen the omni-channel platform, and continuous investment in the global sales operations.

Recent Business Highlights

 

   

Kaleyra delivered 8.5 billion billable messages, a 62% increase from the year ago period, and connected 1.4 billion voice calls, up 195% from the year ago period.

 

   

Kaleyra’s subsidiary, Campaign Registry Inc., has signed all Tier 1 carriers in the US and multiple other carriers representing estimated +98% of the US carrier market.

 

   

Kaleyra was recognized as one of the top chatbot solution providers by CIO Applications.

 

   

In June, Kaleyra closed its landmark acquisition of mobile messaging solution provider mGage to create a top-5 global CPaaS platform with strong positions in the Americas, Europe and Asia-Pacific.

 

   

In conjunction with the mGage transaction, Kaleyra completed strategic capital issuances of new securities that have been valued at $305 million, consisting of $200 million of aggregate gross principal amount of senior unsecured convertible notes due in 2026 and $105 million of gross proceeds from the issuance of Kaleyra common stock in a Private Investment in Public Equity (PIPE) transaction.

 

   

In July, Kaleyra acquired Bandyer adding programmable video APIs and SDK’s to Kaleyra’s communication solutions suite.

Financial Outlook

Kaleyra’s outlook takes into consideration that the Company’s largest markets, Italy and India, will require a continued monitoring of the outcome of the COVID-19 pandemic. It also reflects the pure organic growth of Kaleyra and takes into consideration the mGage and Bandyer acquisitions.

As of August 9, 2021, Kaleyra is providing guidance for its third quarter and full year 2021 as follows:

 

   

Third Quarter 2021 Guidance: Total revenue is expected to be in the range of $79.5 - $80.5 million, absent an accelerated wave of COVID-19 cases and shutdowns.

 

   

Full Year 2021 Guidance: Total revenue is expected to be in the range of $258 – $262 million, confirming the previously communicated guidance, including the revenue from mGage since its acquisition closed on June 1, 2021.

 

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Quarterly Conference Call

Management will conduct an investor conference call today at 8:00 a.m. EST (5:00 a.m. PST) to discuss these results. Questions will be taken after management’s presentation. A live webcast of the call and the replay will be available in the Investors section of the Kaleyra website at https://investors.kaleyra.com/news-events/ir-calendar.

To Participate via Telephone:

US: 877-407-0792

International: 201-689-8263

Conference ID: 13721720

Replay of the call:

US: 844-512-2921

International: 412-317-6671

Start Date: Monday August 9, 2021, 11:00 a.m. ET

End Date: Monday August 22, 2021, 11:59 p.m. ET

About Kaleyra Inc.

Kaleyra, Inc. (NYSE American: KLR) (KLR WS), is a global group providing mobile communication services for financial institutions and enterprises of all sizes worldwide. Through its proprietary platform, Kaleyra manages multi-channel integrated communication services on a global scale, comprising of messages, push notifications, e-mail, instant messaging, voice services and chatbots. Kaleyra’s technology today makes it possible to safely and securely manage billions of messages monthly with a reach to hundreds of MNOs and over 190 countries. For more information: https://www.kaleyra.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. Such forward-looking statements include, but are not limited to, statements regarding the financial statements of Kaleyra, its product and customer developments, its expectations, hopes, beliefs, intentions, plans, prospects or strategies regarding the future revenues and the business plans of Kaleyra’s management team, the anticipated benefits of the acquisitions of mGage and Bandyer by the Company, including the Company’s projected future results and market opportunities following the acquisitions of mGage and Bandyer, and the impact of the COVID-19 pandemic on its business and financial performance. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. The forward-looking statements contained in this press release are based on certain assumptions and analyses made by the management of Kaleyra in light of their respective experience and perception of historical trends, current conditions and expected future developments and their potential effects on Kaleyra as well as other factors they believe are appropriate in the circumstances. There can be no assurance that future developments affecting Kaleyra will be those anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond the control of the parties) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements, including but not limited to: (i) risks that the mGage and Bandyer transactions disrupt current plans and operations of mGage and Bandyer, respectively and potential difficulties in mGage or Bandyer employee retention as a result of the transactiona, (ii) the price of Kaleyra’s securities may be volatile due to a variety of factors, including changes in the competitive and highly regulated industries in which Kaleyra, including mGage and Bandyer, operates, variations in operating performance across

 

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competitors, changes in laws and regulations affecting the Kaleyra’s, including mGage’s and Bandyer’s, business and changes in the combined capital structure, (iii) the ability to integrate mGage and Bandyer into Kaleyra and implement business plans, forecasts, and other expectations after the completion of the transaction, and identify and realize additional opportunities, (iv) the risk of downturns and a changing regulatory landscape in the highly competitive healthcare industry, (v) the size and growth of the market in which mGage operates, (vi) the mix of services utilized by Kaleyra’s customers and such customers’ needs for these services, (vii) market acceptance of new service offerings, (viii) the ability of Kaleyra to expand what it does for existing customers as well as to add new customers, (ix) that Kaleyra will have sufficient capital to operate as anticipated, and (x) the impact that the novel coronavirus and the illness, COVID-19, that it causes, as well as governmental responses to deal with the spread of this illness and the reopening of economies that have been closed as part of these responses, may have on Kaleyra’s operations, the demand for Kaleyra’s products, global supply chains and economic activity in general. Should one or more of these risks or uncertainties materialize or should any of the assumptions being made prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

Non-GAAP Financial Measure and Related Information

To provide investors and others with additional information regarding Kaleyra’s results, the following non-GAAP financial measures, not prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), are disclosed:

 

   

Non-GAAP Adjusted Gross Profit and Non-GAAP Adjusted Gross Margin. For the periods presented, Kaleyra defines non-GAAP gross profit and non-GAAP gross margin as GAAP gross profit and GAAP gross margin, respectively, adjusted to exclude, as applicable, certain expenses as presented in the table below;

 

   

Non-GAAP Adjusted EBITDA is defined as of any date of calculation, as the consolidated pro forma earnings/(loss) of Kaleyra and its subsidiaries, before finance income and finance cost (including bank charges), tax, depreciation and amortization, plus (i) transaction expenses, (ii) without duplication of clause (i), severance or change of control payments, (iii) any expenses related to company restructuring, (iv) the Adjusted EBITDA for pre-acquisition period of subsidiaries, (v) any compensation expenses relating to stock options, restricted stock units, restricted stock or similar equity interests as may be issued by Kaleyra or any of its subsidiaries to its or their employees and (vi) any provision for the write down of assets;

 

   

Non-GAAP Adjusted Net Income (Loss) Per Share, Basic and Diluted. For the periods presented, Kaleyra defines non-GAAP net income (loss) and non-GAAP net income (loss) per share, basic and diluted, as GAAP net loss and GAAP net loss per share, basic and diluted, respectively, adjusted to exclude, as applicable, certain expenses presented in the table below.

Management uses the foregoing non-GAAP financial information, collectively, to evaluate its ongoing operations and for internal planning and forecasting purposes. Kaleyra’s management believes that non-GAAP financial information, when taken collectively, may be helpful to investors because it provides consistency and comparability with past financial performance, facilitates period-to-period comparisons of results of operations, and assists in comparisons with other companies, many of which use similar non-GAAP financial information to supplement their GAAP results. Non-GAAP financial information is presented for supplemental informational purposes only, should not be considered a substitute for financial information presented in accordance with generally accepted accounting principles, and may be different from similarly-titled non-GAAP measures used by other companies. Whenever Kaleyra uses a non-GAAP financial measure, a reconciliation is provided to the most closely applicable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures.

 

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Investor Contacts

Marc P. Griffin

ICR, Inc.

Marc.Griffin@icrinc.com

ir@kaleyra.com

646-277-1290

 

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KALEYRA, INC.

Condensed Consolidated Balance Sheets

(Unaudited, in thousands)

 

     June 30, 2021     December 31, 2020  

ASSETS

    

Current assets:

    

Cash and cash equivalents

   $ 118,625     $ 32,970  

Short-term investments

     6,099       4,843  

Trade receivables, net

     77,252       43,651  

Prepaid expenses

     3,850       1,447  

Deferred costs

     371       —    

Other current assets

     3,668       2,134  
  

 

 

   

 

 

 

Total current assets

     209,865       85,045  

Property and equipment, net

     15,939       6,726  

Intangible assets, net

     133,525       7,574  

Goodwill

     96,788       16,657  

Deferred tax assets

     —         703  

Other long-term assets

     313       1,797  
  

 

 

   

 

 

 

Total Assets

   $ 456,430     $ 118,502  
  

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

    

Current liabilities:

    

Accounts payable

   $ 66,765     $ 51,768  

Debt for forward share purchase agreements

     —         483  

Notes payable due to related parties

     —         7,500  

Lines of credit

     5,338       5,273  

Current portion of bank and other borrowings

     9,448       10,798  

Deferred revenue

     10,775       3,666  

Payroll and payroll related accrued liabilities

     4,124       3,292  

Other current liabilities

     6,647       5,988  
  

 

 

   

 

 

 

Total current liabilities

     103,097       88,768  

Long-term portion of bank and other borrowings

     28,611       31,974  

Long-term portion of notes payable

     189,238       2,700  

Long-term portion of employee benefit obligation

     1,952       1,886  

Deferred tax liabilities

     1,792       —    

Other long-term liabilities

     1,667       603  
  

 

 

   

 

 

 

Total Liabilities

     326,357       125,931  
  

 

 

   

 

 

 

Stockholders’ equity (deficit):

    

Common stock

     4       3  

Additional paid-in capital

     245,452       93,628  

Treasury stock, at cost

     (30,431     (30,431

Accumulated other comprehensive loss

     (2,304     (2,826

Accumulated deficit

     (82,648     (67,803
  

 

 

   

 

 

 

Total stockholders’ equity (deficit)

     130,073       (7,429
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity (deficit)

   $ 456,430     $ 118,502  
  

 

 

   

 

 

 

 

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KALEYRA, INC.

Condensed Consolidated Statements of Operations

(Unaudited, in thousands, except share and per share data)

 

     Three Months Ended June 30,     Six Months Ended June 30,  
     2021     2020     2021     2020  

Revenue

   $ 53,992     $ 31,199     $ 93,706     $ 64,832  

Cost of revenue

     43,529       26,846       76,919       55,748  
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     10,463       4,353       16,787       9,084  
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating expenses:

        

Research and development

     4,282       2,346       7,150       5,156  

Sales and marketing

     4,660       2,989       7,519       6,732  

General and administrative

     12,364       6,537       22,966       14,296  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     21,306       11,872       37,635       26,184  
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss from operations

     (10,843     (7,519     (20,848     (17,100

Other income, net

     47       11       92       53  

Financial expense, net

     (908     (518     (1,627     (559

Foreign currency income (loss)

     (191     (415     164       (247
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss before income tax benefit

     (11,895     (8,441     (22,219     (17,853

Income tax benefit

     (7,408     (313     (7,374     (902
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss

   $ (4,487   $ (8,128   $ (14,845   $ (16,951
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss per common share, basic and diluted

   $ (0.13   $ (0.39   $ (0.46   $ (0.84
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted-average shares used in computing net loss per common share, basic and diluted

     34,292,874       20,606,816       32,328,909       20,293,203  
  

 

 

   

 

 

   

 

 

   

 

 

 

 

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KALEYRA, INC.

Condensed Consolidated Statements of Cash Flows

(Unaudited, in thousands)

 

     Six Months Ended June 30,  
     2021     2020  

Cash Flows from Operating Activities:

    

Net loss

   $ (14,845   $ (16,951

Adjustments to reconcile net loss to net cash used in operating activities:

    

Depreciation and amortization

     3,460       1,269  

Stock-based compensation, preference shares and others

     9,270       11,133  

Non-cash settlement of preference share liability

     —         (2,486

Provision for doubtful accounts

     808       44  

Realized gains on marketable securities

     21       —    

Employee benefit obligation

     122       253  

Change in fair value of warrant liability

     830       —    

Reversal of accrued interest on forward share purchase agreement

     (659     —    

Non-cash interest expense

     325       117  

Deferred taxes

     (6,804     (636

Change in operating assets and liabilities:

    

Trade receivables

     (7,259     793  

Other current assets

     (2,359     1,938  

Deferred costs

     46       —    

Other long-term assets

     1,483       (448

Accounts payable

     (1,882     (5,375

Other current liabilities

     (2,508     5,059  

Deferred revenue

     6,920       171  

Long-term liabilities

     (82     698  
  

 

 

   

 

 

 

Net cash used in operating activities

     (13,113     (4,421
  

 

 

   

 

 

 

Cash Flows from Investing Activities:

    

Purchase of short-term investments

     (1,882     (4,920

Sale of short-term investments

     546       5,041  

Purchase of property and equipment

     (177     (494

Sale of property and equipment

     —         16  

Capitalized software development costs

     (1,633     (1,371

Purchase of intangible assets

     (3     (6

Acquisition of mGage, net of cash acquired

     (195,709     —    
  

 

 

   

 

 

 

Net cash used in investing activities

     (198,858     (1,734
  

 

 

   

 

 

 

Cash Flows from Financing Activities:

    

Proceeds from (repayments on) line of credit, net

     203       1,353  

Borrowings on term loans

     —         8,800  

Repayments on term loans

     (3,451     (5,741

Proceeds from issuance of convertible notes, net of issuance costs

     188,637       —    

Repayments on notes

     (7,500     (5,478

Repurchase of common stock in connection with forward share purchase agreements

     —         (24,218

Receipts (payments) related to forward share purchase agreements

     17,045       (620

Proceeds from issuance of common stock in Private Investment in Public Equity offering, net of issuance costs

     99,051       32,680  

Proceeds related to settlement of non-forfeited 2020 Sponsor Earnout Shares

     1,244       —    

Proceeds from the exercise of common stock warrants

     2,872       —    

Repayments on capital lease

     (66     —    
  

 

 

   

 

 

 

Net cash provided by financing activities

     298,035       6,776  
  

 

 

   

 

 

 

Effect of exchange rate changes on cash, cash equivalents and restricted cash

     (409     (370
  

 

 

   

 

 

 

Net increase in cash, cash equivalents and restricted cash

     85,655       251  

Cash, cash equivalents and restricted cash, beginning of period

     32,970       36,997  
  

 

 

   

 

 

 

Cash, cash equivalents and restricted cash, end of period

   $ 118,625     $ 37,248  
  

 

 

   

 

 

 

 

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KALEYRA, Inc.

Adjusted Gross Profit and Adjusted Gross Margin Reconciliation of GAAP to Non-GAAP Financial Information

For the Three and the Six Months Ended June 30, 2021 and 2020

(Unaudited, in millions)

 

     Three Months
Ended June 30,
    Six Months
Ended June 30,
 
     2021     2020     2021     2020  

Adjusted Gross Profit and Adjusted Gross Margin

        

Consolidated Gross Profit

   $ 10.5     $ 4.4     $ 16.8     $ 9.1  

Consolidated Gross Profit Margin %

     19.4     14.0     17.9     14.0

Amortization of acquired intangibles

     0.7       0.2       0.8       0.3  

Non-GAAP Gross Profit

   $ 11.1     $ 4.5     $ 17.6     $ 9.4  

Non-GAAP Gross Profit Margin %

     20.6     14.5     18.8     14.5

KALEYRA, Inc.

Adjusted EBITDA Reconciliation of GAAP to Non-GAAP Financial Information

For the Three and the Six Months Ended June 30, 2021 and 2020

(Unaudited, in millions)

 

     Three Months
Ended June 30,
     Six Months
Ended June 30,
 
     2021      2020      2021      2020  

Adjusted EBITDA

           

Net Loss

   $ (4.5    $ (8.1    $ (14.8    $ (17.0

Other income, net

     (0.0      (0.0      (0.1      (0.1

Financial expense, net

     0.9        0.5        1.6        0.6  

Foreign currency income (loss)

     0.2        0.4        (0.2      0.2  

Income tax benefit

     (7.4      (0.3      (7.4      (0.9
  

 

 

    

 

 

    

 

 

    

 

 

 

Loss from operations

   $ (10.8    $ (7.5    $ (20.8    $ (17.1

Depreciation and amortization

     2.6        0.6        3.5        1.3  

Stock-based compensation, preference shares and others

     6.0        4.8        11.4        11.1  

Transaction and one-off costs

     4.5        1.8        7.0        4.2  
  

 

 

    

 

 

    

 

 

    

 

 

 

Non-GAAP Adjusted EBITDA

   $ 2.2      $ (0.3    $ 1.0      $ (0.5
  

 

 

    

 

 

    

 

 

    

 

 

 

 

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KALEYRA, Inc.

Adjusted Net Income (Loss) per share Reconciliation of GAAP to Non-GAAP Financial Information

For the Three and the Six Months Ended June 30, 2021 and 2020

(Unaudited, in millions)

 

     Three Months Ended June 30,      Six Months Ended June 30,  
     2021      2020      2021      2020  

Adjusted Net Income (Loss) per share

           

Net Loss

   $ (4.5    $ (8.1    $ (14.8    $ (17.0

Stock-based compensation, preference shares and others

     6.0        4.8        11.4        11.1  

Transaction and one-off costs

     4.5        1.8        7.0        4.2  

Amortization of acquired intangibles

     1.8        0.4        2.2        0.8  

Amortization of issuance costs for convertible debt

     0.2        0.0        0.2        0.0  

Estimated tax effects of adjustments (1)

     (0.6      (0.3      (0.6      (0.8

Tax benefits related to reversal of valuation allowance on discrete tax items

     (6.8      0.0        (6.8      0.0  
  

 

 

    

 

 

    

 

 

    

 

 

 

Non-GAAP Net Income (Loss)

   $ 0.5      $ (1.4    $ (1.5    $ (1.7
  

 

 

    

 

 

    

 

 

    

 

 

 

Net Loss per share

           

Basic

   $ (0.13    $ (0.39    $ (0.46    $ (0.84

Diluted

   $ (0.13    $ (0.39    $ (0.46    $ (0.84

Non-GAAP Adjusted Net Income (Loss) per share

           

Basic

   $ 0.01      $ (0.07    $ (0.05    $ (0.08

Diluted

   $ 0.01      $ (0.07    $ (0.05    $ (0.08

Weighted Average number of Shares Outstanding (basic)

     34,292,874        20,606,816        32,328,909        20,293,203  

Weighted Average number of Shares Outstanding (diluted)

     44,946,532        20,606,816        32,328,909        20,293,203  

 

(1)

The Non-GAAP estimated tax effects of adjustments is determined using the Effective Tax Rate (ETR) calculated for the three months period, excluding discrete tax items.

 

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