Inovalon Mergers and Acquisitions Presentation Deck
Reconciliation of Forward-Looking Preliminary Guidance
Adjusted EBITDA
Inovalon defines Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA) as net income calculated in accordance with GAAP,
adjusted for the impact of depreciation and amortization, realized losses on short-term investments, loss (gain) on disposal of equipment, interest expense, interest
income, provision for income taxes, stock-based compensation, acquisition costs, tax on equity exercises, and other non-comparable items. Adjusted EBITDA
margin is defined as Adjusted EBITDA as a percentage of revenue. A reconciliation of forward-looking preliminary net income guidance to forward-looking preliminary
Adjusted EBITDA guidance follows:
(In millions)
Reconciliation of Forward-Looking Guidance Net Income to Adjusted EBITDA:
Net income
12
Depreciation and amortization
Loss (gain) on disposal of equipment
Interest income
Interest expense
Provision for income taxes (1)
EBITDA
Stock-based compensation
Acquisition costs:
Transaction costs
Integration costs
Contingent consideration accretion
Compensatory contingent consideration
Other non-comparable items (2)
Adjusted EBITDA
Adjusted EBITDA Margin
$
Guidance Range
Twelve Months Ending
December 31, 2018
High
Low
(5)
86
(1)
38
(1)
117
20
4
9
CON 10
6
2
5
163
28.7%
3
86
(1)
38
1
127
20
4062
10
5
174
29.4%
A 30% tax rate is assumed in order to approximate the Company's effective corporate tax rate.
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. Non-comparable items are excluded from Adjusted EBITDA in order to more effectively assess the Company's period over period and on going operating performance.
INOV & ABILITY Presentation (3.7.18) v1.0.0
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