Cision Reports Third Quarter 2018 Financial Results; Provides Updated Full Year 2018 Outlook

Third Quarter 2018 Financial Highlights

"We are pleased to have delivered another solid quarter of financial results," said Kevin Akeroyd, Cision's Chief Executive Officer. "We continue to focus our efforts on delivering best-in-class products and services to our customers, executing our strategic and operational plans, and driving toward our long-term financial goals. This focus resulted in third quarter pro forma organic revenue growth of 2.1% after adjusting for non-core revenues and the impact of currency, an approximate 160 basis-point increase from the prior year's third fiscal quarter."

Third Quarter Business Statistics and Operational Highlights

Long-Term Debt

As of September 30, 2018, we had approximately $974.7 million of outstanding dollar-denominated term loans and approximately €247.5 million of outstanding Euro-denominated term loans. In addition to the $3.3 million in quarterly amortization payments during the third quarter, we further reduced our outstanding dollar-denominated term loan by $10.0 million through a voluntary prepayment pursuant to the terms of our 2017 First Lien Credit Facility.

On October 22, 2018, we  completed a repricing of our First Lien Credit Facility. The repricing reduced the interest rate on revolving borrowings and USD borrowings from LIBOR plus 3.25% to LIBOR plus 2.75%, and reduced the interest rate on EUR borrowings from EURIBOR plus 3.50% to EURIBOR plus 3.00%. We estimate that the 50 basis point reduction on USD and EUR borrowings will reduce our annual cash interest costs by approximately $6.3 million. "We are pleased to have concluded this repricing transaction on such beneficial terms," said Jack Pearlstein, Cision's Chief Financial Officer. "The repricing will provide us with incremental annual cash interest savings and represents another step in our ongoing effort to reduce interest expense, drive increased cash flow and, by extension, drive incremental value for our shareholders."

Subscription and Transaction Customer Trends

Our average pro forma subscription customers, average annualized pro forma revenue per subscription customer, pro forma number of customers that purchased services from us on a transaction basis, and average pro forma revenue per customer that purchased services from us on a transaction basis appear below for the most recent five fiscal quarters. All of the figures below have been adjusted to exclude the impact of currency.

Updated Full Year 2018 Outlook

Our updated outlook for the full year ending December 31, 2018 appears below (all figures in millions, except per share amounts). These estimates are based on a number of assumptions that management believes to be reasonable and reflect the Company's expectations as of the date of this release. Actual results may differ materially from these estimates as a result of various factors, and the Company refers you to the cautionary language regarding "Forward Looking Statements" included in this press release when considering this information.

Additionally, for the full year ending December 31, 2018, we expect (all figures in millions):

The updated outlook above assumes three-month LIBOR of approximately 2.5% and three-month EURIBOR of approximately 0.0%. The above outlook also incorporates a change from the prior quarter with respect to our exchange rate assumptions for the fourth quarter of 2018. This change in our exchange rate assumption for the British Pound, the Euro and the Canadian Dollar reduced our revenue outlook for the fourth quarter of 2018 by approximately $1.0 million, reduced our Adjusted EBITDA outlook for the fourth quarter of 2018 by approximately $0.4 million, and reduced our Adjusted net income per diluted share outlook for the fourth quarter of 2018 by $0.01. On September 13, 2018, we issued 2,000,000 earn-out shares to Canyon Holdings (Cayman), L.P. ("Cision Owner") as consideration for our merger with Capitol Acquisition Corp. III. This issuance increased our weighted average shares outstanding during the third quarter of 2018 by approximately 390,000 shares and will increase our weighted average shares outstanding for the fourth quarter of 2018 by 2,000,000 shares. This share issuance does not reduce our Adjusted net income per diluted share for the third quarter of 2018 and reduces our Adjusted net income per diluted share outlook for the full year 2018 by approximately $0.01. Excluding the impact of the change in our exchange rate assumptions and our issuance of 2,000,000 earn-out shares to Cision Owner, our updated revenue outlook, including the impact from purchase accounting would have been $726 million to $730 million, our updated Adjusted EBITDA outlook would have been $251 million to $253 million, and our updated Adjusted net income per diluted share outlook would have been $0.84 to $0.86. Our previous and updated assumptions for the British Pound, the Euro and the Canadian Dollar appear below:

We plan to adopt Accounting Standards Codification Topic 606 ("ASC 606") on a modified retrospective basis, effective December 31, 2018. We are in the process of determining the potential impact of adopting this new standard, which could have a significant impact on our fourth quarter and full year 2018 financial results. Additionally, our outlook for 2018 excludes the impact of any future acquisitions, divestitures, voluntary prepayments of our 2017 First Lien Credit Facility, future refinancings or repricings of our 2017 First Lien Credit Facility, the adoption of ASC 606 or other unanticipated events. See discussion of non-GAAP financial measures below in this release.

Third Quarter 2018 Conference Call Details

As previously announced, we will hold a conference call to review our third quarter 2018 financial results on Wednesday, November 7th at 5:00 pm EST. To hear the live event, visit the Cision investor website at http://investors.cision.com, or dial 1-877-443-4809 (participant dial in toll free) or 1-412-317-5235 (participant dial in International). The conference call will be simultaneously webcast on the Investor Relations section of our website: http://investors.cision.com

Forward-Looking Statements

This communication contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. In this context, forward-looking statements often address expected future business and financial performance and financial condition, and often contain words such as "anticipate," "intend," "plan," "goal," "seek," "aim," "strive," "believe," "see," "project," "predict," "estimate," "expect," "continue," "strategy," "future," "likely," "may," "might," "should," "will," "would," "target," similar expressions, and variations or negatives of these words. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations, and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy, and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks, and changes in circumstances that are difficult to predict and many of which are outside of our control. Accordingly, you should not place undue reliance on these statements, as actual results may vary materially. A detailed discussion of some of the risks and uncertainties that could cause our actual results and financial condition to differ materially from the forward-looking statements is described under the caption "Risk Factors" in our most recent annual report on Form 10-K filed on March 13, 2018, along with our other filings with the U.S. Securities and Exchange Commission. Any forward-looking statement made by us in this communication is based only on information currently available to us and speaks only as of the date of this release. We do not assume any obligation to publicly provide revisions or updates to any forward-looking statements, whether as a result of new information, future developments or otherwise, should circumstances change, except as otherwise required by securities and other applicable laws. Please consult our public filings at www.sec.gov or www.cision.com.

About Cision
Cision Ltd. (NYSE: CISN) is a leading global provider of earned media software and services to public relations and marketing communications professionals. Cision's software allows users to identify key influencers, craft and distribute strategic content, and measure meaningful impact. Cision has over 4,000 employees with offices in 19 countries throughout the Americas, EMEA, and APAC. For more information about its award-winning products and services, including the Cision Communications Cloud®, visit www.cision.com and follow Cision on Twitter @Cision.

Use of Non-GAAP Financial Measures

Non-GAAP results are presented only as a supplement to our financial statements based on U.S. generally accepted accounting principles (GAAP). Non-GAAP financial information is provided to enhance the reader's understanding of our financial performance, but none of these non-GAAP financial measures are recognized terms under GAAP, and non-GAAP measures should not be considered in isolation or as a substitute for financial measures calculated in accordance with GAAP. Reconciliations of the most directly comparable GAAP measures to non-GAAP measures, such as Adjusted EBITDA and Adjusted net income per share, are provided within the schedules attached to this release. We use non-GAAP measures in our operational and financial decision-making, believing that it is useful to exclude certain items in order to focus on what we deem to be a more reliable indicator of ongoing operating performance and our ability to generate cash flow from operations. As a result, internal management reports used during monthly operating reviews include Adjusted EBITDA, Adjusted net income per diluted share and organic revenue growth. We define organic revenue growth as the change in our total revenue excluding non-core revenues, calculated on a constant currency basis after giving pro forma effect to all acquisitions as though they occurred at the beginning of the applicable period. Additionally, we believe that the presentation of non-GAAP measures provides information that is useful to investors, research analysts, investment banks and lenders under our 2017 First Lien Credit Facility as it indicates, for example, our ability to meet capital expenditures and working capital requirements and otherwise meet our obligations as they become due. Investors are cautioned that non-GAAP financial measures are not a substitute for GAAP disclosures. This communication also includes certain forward-looking non-GAAP financial measures. We are unable to present without unreasonable efforts a reconciliation of forward-looking non-GAAP financial information to the corresponding GAAP financial information because management cannot reliably predict all of the necessary information. Forward-looking non-GAAP financial information is based on numerous assumptions, including assumptions with respect to general business, economic, market, regulatory and financial conditions and various other factors, all of which are difficult to predict and many of which are beyond our control. Accordingly, investors are cautioned not to place undue reliance on this information.

Non-GAAP measures are frequently used by securities analysts, investors, and other interested parties in their evaluation of companies comparable to Cision, many of which present non-GAAP measures when reporting their results. These measures can be useful in evaluating our performance against our peer companies because we believe the measures provide users with valuable insight into key components of GAAP financial disclosures. However, non-GAAP measures have limitations as an analytical tool. Non-GAAP measures are not necessarily comparable to similarly titled measures used by other companies. They are not presentations made in accordance with GAAP, are not measures of financial condition or liquidity, and should not be considered as an alternative to profit or loss for the period determined in accordance with GAAP or operating cash flows determined in accordance with GAAP. As a result, you should not consider such performance measures in isolation from, or as a substitute analysis for, results of operations as determined in accordance with GAAP.

Investor Contact:
Jack Pearlstein
Chief Financial Officer
Jack.Pearlstein@cision.com 

Media Contact:
Nick Bell
Vice President, Marketing Communications and Content
CisionPR@cision.com 

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