Inovalon Results Presentation Deck
Reconciliation of Forward-Looking Guidance Adjusted
EBITDA
Inovalon defines Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA) as net income or loss calculated in
accordance with GAAP, adjusted for the impact of depreciation and amortization, other expense, net, interest income, interest expense, provision for
income taxes, stock-based compensation, acquisition costs, restructuring expense, and other non-comparable items. Adjusted EBITDA margin is defined
as Adjusted EBITDA as a percentage of revenue. A reconciliation of net income to Adjusted EBITDA follows:
(In millions)
Reconciliation of Forward-Looking Guidance Net (loss) income to Adjusted EBITDA:
Net (loss) income
Depreciation and amortization
Interest expense
Interest income
(1)
Provision for income taxes
EBITDA
Stock-based compensation
Acquisition costs:
Integration costs
Contingent consideration
Other non-comparable items (2)
Adjusted EBITDA
Adjusted EBITDA margin
Three Months Ending
December 31, 2020
Low
High
INOV Q3 2020 Earnings Supplement (10.28.20) v1.0.0
17
28
14
54
8
I
||
35.2%
389108°
15
73
38.4%
60-
Guidance Range
Year Ending
December 31, 2020
Low
High
19
115
57
(1)
(8)
182
31
1
3
34.4%
116
(8)
192
31
236
35.3%
100
Year Ending
December 31, 2021
Low
High
115
(1)
16
1
265
35.8%
47
116
57
(1)
19
32
11
275
36.1%
A 28% statutory tax rate is assumed in order to approximate the Company's effective corporate tax rate for future periods.
Other "non-comparable items include items that are not comparable across reporting periods or items that do not otherwise relate to the Company's ongoing financial results, such as certain employee related expenses attributable to advancements in automation and operational
efficiencies, and legal expenses beyond those in the normal course of business. Non-comparable items are excluded from Adjusted EBITDA in order to more effectively assess the Company's period over period and ongoing operating performance.
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