Advantage Solutions(ADV) - 2024 Q3 - Quarterly Report

Financial Performance - Revenues for the three months ended September 30, 2024 decreased by $80.4 million, or 7.9$939.3 million compared to the same period in 2023[118]. - Operating income from continuing operations for the three months ended September 30, 2024 resulted in an operating loss of $3.2 million, a decrease of$9.9 million[118]. - Net loss from continuing operations increased by $7.7 million to$37.3 million for the three months ended September 30, 2024[118]. - Revenues for the nine months ended September 30, 2024 decreased by $234.2 million, or 8.1$2,674.0 million compared to the same period in 2023[119]. - Adjusted Net Income for the nine months ended September 30, 2024 increased by $9.1 million, or 14.2$54.9 million[119]. - Adjusted Net Income decreased by $3.9 million, or 1.5$261.5 million for the nine months ended September 30, 2024, from $265.4 million in the prior year[194]. - Adjusted Net Income for September 2024 was$23,667,000, a decrease from $24,775,000 in September 2023, representing a decline of 4.5$37,320,000 for the three months ended September 2024, compared to a net loss of $29,632,000 for the same period in 2023, indicating a worsening of 25.5$15.0 million, primarily due to an intentional client resignation and a weaker economic environment[160]. - The Experiential Services segment saw an increase in revenues of $34.4 million, or 11.1$344.4 million, or 25.9%, to $982.8 million for the nine months ended September 30, 2024, largely due to an intentional client resignation[177]. - Experiential Services segment revenues increased by$118.9 million, or 14.0%, to $969.6 million for the nine months ended September 30, 2024, driven by higher event volumes[178]. Cost and Expenses - Adjusted EBITDA from Continuing Operations for the nine months ended September 30, 2024 decreased by$3.9 million, or 1.5%, to $261.5 million[119]. - Cost of revenues as a percentage of total revenues improved to 84.6$99.7 million related to the Branded Agencies reporting unit during the nine months ended September 30, 2024[137]. - A restructuring plan was announced in July 2024, aimed at improving cost structure and operational efficiency, expected to be substantially completed by the end of 2024[152]. - The Company incurred $18.6 million and$74.0 million in reorganization expenses during the three and nine months ended September 30, 2024, respectively, compared to $21.4 million and$38.3 million in the same periods of 2023[153]. - The company incurred reorganization expenses of $2,250,000 for the three months ended September 30, 2024, compared to$1,044,000 for the same period in 2023[204]. - A non-cash goodwill impairment charge of $99.7 million was recognized during the nine months ended September 30, 2024, impacting overall financial performance[182]. Cash Flow and Liquidity - The company’s principal sources of liquidity include cash flows from operations and borrowings under the Revolving Credit Facility, with cash primarily used for operating expenses and technology investments[143]. - Net cash provided by operating activities from continuing operations was$78,009,000 for the nine months ended September 30, 2024, compared to $172,576,000 for the same period in 2023[209]. - Net cash provided by investing activities from continuing operations was$211,427,000 for the nine months ended September 30, 2024, compared to a net cash used of $(10,256,000) for the same period in 2023[209]. - Net cash used in financing activities from continuing operations was$(207,122,000) for the nine months ended September 30, 2024, compared to $(115,170,000) for the same period in 2023[209]. - The company reported a net change in cash, cash equivalents, and restricted cash of$80,909,000 for the nine months ended September 30, 2024, compared to $47,805,000 for the same period in 2023[209]. - Existing domestic cash and cash flows from operations are expected to be sufficient to fund domestic operating activities for at least the next 12 months[239]. Debt Management - The Term Loan Facility has an aggregate principal amount of$1.1 billion, with borrowings amortizing at 1.00% per annum of the original issued amount of $1.3 billion[221]. - The Company voluntarily repurchased$127.9 million principal amount of its Senior Secured Notes during the nine months ended September 30, 2024, recognizing a gain of $8.6 million[228]. - The Revolving Credit Facility matures in December 2027 and provides for revolving loans and letters of credit up to$500.0 million[214]. - The Term Loan Facility bears interest at a floating rate of Term SOFR plus an applicable margin of 4.25% per annum[221]. - The Company recognized a gain of $0.5 million from repurchases of the Term Loan Facility during the nine months ended September 30, 2024[221]. Other Financial Metrics - Interest expense, net decreased by$3.3 million, or 7.8%, to $39.0 million for the three months ended September 30, 2024, primarily due to a lower debt balance from repurchases of Term Loan Facility and Senior Secured Notes[169]. - Interest expense decreased by$5.4 million, or 4.5%, to $114.5 million for the nine months ended September 30, 2024, due to lower debt balances[188]. - The company reported costs associated with COVID-19 of$0 for the three months ended September 2024, compared to $(49,000) in the same period of 2023, reflecting a reduction in pandemic-related expenses[197]. - The company recognized a goodwill impairment charge of$99.7 million related to the Branded Agencies reporting unit during the second quarter of fiscal year 2024[246]. - The company does not have any off-balance sheet financing arrangements or liabilities[240].