Doma's Q4 Results Demonstrate Significant Progress Towards Achieving Profitability in 2023; Delivers Full Year Adjusted EBITDA Within Revised 2022 Guidance

February 28, 2023 at 4:10 PM EST
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 Fourth Quarter 2022 Business Highlights(1):

  • Total revenues of $96 million, down 11% versus Q3 2022
  • Retained premiums and fees of $35 million, down 17% versus Q3 2022
  • Gross profit of $9 million, up 25% versus Q3 2022
  • Adjusted gross profit of $14 million, up 20% versus Q3 2022
  • Adjusted EBITDA loss of $16 million, compared to a loss of $30 million in Q3 2022
  • Purchase closed orders down 26% versus Q3 2022, Refinance closed orders down 36% versus Q3 2022, and Total closed orders down 31% versus Q3 2022

SAN FRANCISCO--(BUSINESS WIRE)--Feb. 28, 2023-- Doma Holdings, Inc. (NYSE: DOMA) (“Doma” or the “Company”), a leading force for disruptive change in the real estate industry, today reported quarterly financial results and key operating data for the three months and full year ended December 31, 2022(2). Doma achieved significant adjusted EBITDA loss improvement in the fourth quarter and delivered full year adjusted EBITDA within its revised guidance range. The Company remains on track to achieve adjusted EBITDA profitability in 2023.

"We are now seeing the tangible benefits of the significant actions we took last year to protect our bottom line and to achieve our industry transforming vision," said Max Simkoff, CEO of Doma. "Given the rapid rise in both mortgage rates and home prices we experienced last year, it's no surprise that we've seen a resultant unprecedented decline in home affordability impacting virtually everyone across the country. As we head into 2023, we are uniquely positioned to provide cost-effective solutions to home owners and prospective home owners via our proven instant underwriting platform, ultimately alleviating home affordability challenges."

Doma's $14 million adjusted EBITDA improvement in the fourth quarter compared to the third quarter was a direct result of key strategic cost saving decisions made throughout 2022. Despite a housing market that is likely to remain volatile for the foreseeable future, Doma has reiterated its commitment to achieving adjusted EBITDA profitability in 2023. Margin improvements are expected to continue throughout the year as the full benefit of actions implemented in 2022 are realized, and as the company continues to prioritize profitability contribution from its Local branch operations. Additionally, Doma is finalizing the best strategies for more efficient and more profitable deployment of its proven instant underwriting technology via new partnerships with mortgage originators and the broader lending ecosystems, ultimately making their technology more widely available and most importantly, saving homeowners money.

"We are pleased to deliver full year 2022 adjusted EBITDA within our revised guidance range and to have made progress towards achieving profitability," said Mike Smith, Chief Financial Officer of Doma. "We made meaningful expense reduction decisions early on in the mortgage market downturn and acted swiftly late last year when we knew continued mortgage market instability meant additional cost reductions were necessary. The team continues to prioritize our investments with profitability and cash generation at the forefront, and we look forward to achieving sustainable profitability in 2023."

(1)

Reconciliations of retained premiums and fees, adjusted gross profit, and the other financial measures used in this press release that are not calculated in accordance with generally accepted accounting principles in the United States (“GAAP”) to the nearest measures prepared in accordance with GAAP have been provided in this press release in the accompanying tables. An explanation of these measures is also included below under the heading “Non-GAAP Financial Measures.”

(2)

Doma completed its business combination with Capitol Investment Corp. V ("Capitol") on July 28, 2021. The financial results and key operating data included in this fourth quarter release include operating results of Doma prior to completion of the business combination and operating results of the combined company subsequent to completion of the business combination.

Non-GAAP Financial Measures

Some of the financial information and data contained in this press release, such as retained premiums and fees, adjusted gross profit and adjusted EBITDA, have not been prepared in accordance with United States generally accepted accounting principles ("GAAP"). Retained premiums and fees is defined as revenue less premiums retained by third-party agents. Adjusted gross profit is defined as gross profit (loss), adjusted to exclude the impact of depreciation and amortization. Adjusted EBITDA is defined as net income (loss) before interest, income taxes, depreciation and amortization, and further adjusted to exclude the impact of stock-based compensation, severance costs, goodwill impairment, long-lived asset impairment, the change in fair value of warrant and sponsor covered shares liabilities and accelerated contract expense. Doma believes that the use of retained premiums and fees, adjusted gross profit and adjusted EBITDA provides additional tools to assess operational performance and trends in, and in comparing Doma's financial measures with, other similar companies, many of which present similar non-GAAP financial measures to investors. Doma’s non-GAAP financial measures may be different from non-GAAP financial measures used by other companies. The presentation of non-GAAP financial measures is not intended to be considered in isolation or as a substitute for, or superior to, financial measures determined in accordance with GAAP. Because of the limitations of non-GAAP financial measures, you should consider the non-GAAP financial measures presented herein in conjunction with Doma’s financial statements and the related notes thereto. Please refer to the non-GAAP reconciliations in this press release for a reconciliation of these non-GAAP financial measures to the most comparable financial measure prepared in accordance with GAAP.

Conference Call Information

Doma will host a conference call at 5:00 PM Eastern Time on Tuesday, February 28, to present its fourth quarter 2022 financial results.

Dial-in Details: To access the call by phone, please go to this link (registration link), and you will be provided with dial-in details. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the scheduled start time.

The live webcast of the call will be accessible on the Company’s website at investor.doma.com. Approximately two hours after conclusion of the live event, an archived webcast of the conference call will be accessible from the Investor Relations section of the Company’s website for twelve months.

About Doma Holdings, Inc.

Doma is a real estate technology company that is disrupting a century-old industry by building an instant and frictionless home closing experience for buyers and sellers. Doma uses proprietary machine intelligence technology and deep human expertise to create a vastly more simple and affordable experience for everyone involved in a residential real estate transaction, including current and prospective homeowners, mortgage lenders, title agents, and real estate professionals. With Doma, what used to take days can now be done in minutes, replacing an arcane and cumbersome process with a digital experience designed for today’s world. To learn more visit doma.com.

Forward-Looking Statements Legend

This press release includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "estimate," "plan," "project," "forecast," "intend," "will," "expect," "anticipate," "believe," "seek," "target" or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. The absence of these words does not mean that a statement is not forward-looking. Such statements are based on the beliefs of, as well as assumptions made by information currently available to Doma management. These forward-looking statements include, but are not limited to, statements regarding estimates and forecasts of financial and performance metrics, projections of market opportunity, total addressable market ("TAM"), market share and competition. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectation of Doma’s management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict, will differ from assumptions and are beyond the control of Doma.

These forward-looking statements are subject to a number of risks and uncertainties, including changes in business, market, financial, political and legal conditions; risks relating to the uncertainty of the projected financial information with respect to Doma; future global, regional or local economic, political, market and social conditions, including due to the COVID-19 pandemic; the development, effects and enforcement of laws and regulations, including with respect to the title insurance industry; Doma’s ability to manage its future growth or to develop or acquire enhancements to its platform; the effects of competition on Doma’s future business; the outcome of any potential litigation, government and regulatory proceedings, investigations and inquiries; and those other factors described in Part I, Item 1A - “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2021 and any subsequent reports filed by Doma from time to time with the U.S. Securities and Exchange Commission (the “SEC”).

If any of these risks materialize or Doma’s assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that Doma does not presently know or that Doma currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect Doma’s expectations, plans or forecasts of future events and views as of the date of this press release. Doma anticipates that subsequent events and developments will cause Doma’s assessments to change. However, while Doma may elect to update these forward-looking statements at some point in the future, Doma specifically disclaims any obligation to do so, except as required by law. These forward-looking statements should not be relied upon as representing Doma’s assessment as of any date subsequent to the date of this press release. Accordingly, undue reliance should not be placed upon the forward-looking statements.

Key Operating and Financial Indicators

 

Three Months Ended December 31,

 

Year ended December 31,

 

2022

 

2021

 

2022

 

2021

 

(Unaudited - in thousands, except for open and closed order numbers)

Key operating data:

 

 

 

 

 

 

 

Opened orders

 

11,602

 

 

 

43,247

 

 

 

93,534

 

 

 

178,689

 

Closed orders

 

10,505

 

 

 

37,042

 

 

 

71,953

 

 

 

136,428

 

 

 

 

 

 

 

 

 

GAAP financial data:

 

 

 

 

 

 

 

Revenue (1)

$

96,374

 

 

$

137,679

 

 

$

440,181

 

 

$

558,043

 

Gross profit (2)

$

9,197

 

 

$

22,031

 

 

$

30,829

 

 

$

103,261

 

Net loss (3)

$

(109,418

)

 

$

(43,729

)

 

$

(302,209

)

 

$

(113,056

)

Non-GAAP financial data (4):

 

 

 

 

 

 

 

Retained premiums and fees

$

35,279

 

 

$

66,349

 

 

$

178,705

 

 

$

259,598

 

Adjusted gross profit

$

13,982

 

 

$

24,646

 

 

$

46,848

 

 

$

113,582

 

Ratio of adjusted gross profit to retained premiums and fees

 

40

%

 

 

37

%

 

 

26

%

 

 

44

%

Adjusted EBITDA

$

(16,387

)

 

$

(36,303

)

 

$

(134,914

)

 

$

(71,592

)

_________________

(1)

Revenue is comprised of (i) net premiums written, (ii) escrow, other title-related fees and other, and (iii) investment, dividend and other income. Net loss is made up of the components of revenue and expenses.

(2)

Gross profit, calculated in accordance with GAAP, is calculated as total revenue, minus premiums retained by third-party agents, direct labor expense (including mainly personnel expense for certain employees involved in the direct fulfillment of policies) and direct non-labor expense (including mainly title examination expense, provision for claims, and depreciation and amortization). In our consolidated income statements, depreciation and amortization is recorded under the “other operating expenses” caption.

(3)

Net loss is made up of the components of revenue and expenses.

(4)

Retained premiums and fees, adjusted gross profit and adjusted EBITDA are non-GAAP financial measures.

Non-GAAP Financial Measures

Retained premiums and fees

The following table reconciles our retained premiums and fees to our gross profit, the most closely comparable GAAP financial measure, for the periods indicated:

 

Three Months Ended December 31,

 

Year ended December 31,

 

2022

 

2021

 

2022

 

2021

 

(Unaudited - in thousands)

 

(Unaudited - in thousands)

Revenue

$

96,374

 

$

137,679

 

$

440,181

 

$

558,043

Minus:

 

 

 

 

 

 

 

Premiums retained by third-party agents

 

61,095

 

 

71,330

 

 

261,476

 

 

298,445

Retained premiums and fees

$

35,279

 

$

66,349

 

$

178,705

 

$

259,598

Minus:

 

 

 

 

 

 

 

Direct labor

 

14,665

 

 

26,787

 

 

86,573

 

 

89,616

Provision for claims

 

1,154

 

 

4,594

 

 

16,740

 

 

21,335

Depreciation and amortization

 

4,785

 

 

2,615

 

 

16,019

 

 

10,321

Other direct costs (1)

 

5,478

 

 

10,322

 

 

28,544

 

 

35,065

Gross Profit

$

9,197

 

$

22,031

 

$

30,829

 

$

103,261

__________________

(1)

Includes title examination expense, office supplies, and premium and other taxes.

Adjusted gross profit

The following table reconciles our adjusted gross profit to our gross profit, the most closely comparable GAAP financial measure, for the periods indicated:

 

Three Months Ended December 31,

 

Year ended December 31,

 

2022

 

2021

 

2022

 

2021

 

(Unaudited - in thousands)

 

(Unaudited - in thousands)

Gross Profit

$

9,197

 

$

22,031

 

$

30,829

 

$

103,261

Adjusted for:

 

 

 

 

 

 

 

Depreciation and amortization

 

4,785

 

 

2,615

 

 

16,019

 

 

10,321

Adjusted Gross Profit

$

13,982

 

$

24,646

 

$

46,848

 

$

113,582

Adjusted EBITDA

The following table reconciles our adjusted EBITDA to our net loss, the most closely comparable GAAP financial measure, for the periods indicated:

 

Three Months Ended December 31,

 

Year ended December 31,

 

2022

 

2021

 

2022

 

2021

 

(Unaudited - in thousands)

 

(Unaudited - in thousands)

Net loss (GAAP)

$

(109,418

)

 

$

(43,729

)

 

$

(302,209

)

 

$

(113,056

)

Adjusted for:

 

 

 

 

 

 

 

Depreciation and amortization

 

4,785

 

 

 

2,615

 

 

 

16,019

 

 

 

10,321

 

Interest expense

 

4,800

 

 

 

4,519

 

 

 

18,080

 

 

 

16,861

 

Income taxes

 

(1,988

)

 

 

421

 

 

 

(1,242

)

 

 

927

 

EBITDA

$

(101,821

)

 

$

(36,174

)

 

$

(269,352

)

 

$

(84,947

)

Adjusted for:

 

 

 

 

 

 

 

Stock-based compensation

 

6,293

 

 

 

11,040

 

 

 

33,687

 

 

 

20,046

 

Severance costs

 

11,218

 

 

 

—

 

 

 

19,613

 

 

 

—

 

Goodwill impairment

 

31,461

 

 

 

—

 

 

 

65,207

 

 

 

—

 

Long-lived asset impairment

 

32,027

 

 

 

—

 

 

 

32,027

 

 

 

—

 

Change in fair value of Warrant and Sponsor Covered shares liabilities

 

(786

)

 

 

(11,169

)

 

 

(21,317

)

 

 

(6,691

)

Accelerated contract expense

 

5,221

 

 

 

—

 

 

 

5,221

 

 

 

—

 

Adjusted EBITDA

$

(16,387

)

 

$

(36,303

)

 

$

(134,914

)

 

$

(71,592

)

The following table reconciles our adjusted gross profit to our adjusted EBITDA, for the periods indicated:

 

Three Months Ended December 31,

 

Year ended December 31,

 

2022

 

2021

 

2022

 

2021

 

(Unaudited - in thousands)

 

(Unaudited - in thousands)

Adjusted Gross Profit

$

13,982

 

 

$

24,646

 

 

$

46,848

 

 

$

113,582

 

Minus:

 

 

 

 

 

 

 

Customer acquisition costs

 

6,324

 

 

 

18,251

 

 

 

47,926

 

 

 

55,208

 

Other indirect costs (1)

 

24,045

 

 

 

42,698

 

 

 

133,836

 

 

 

129,966

 

Adjusted EBITDA

$

(16,387

)

 

$

(36,303

)

 

$

(134,914

)

 

$

(71,592

)

__________________

(1)

Includes corporate support, research and development, and other operating costs.

 

Doma Holdings, Inc.

Consolidated Statements of Operations

 

 

Year ended December 31

(Unaudited - in thousands, except share and per share information)

2022

 

2021

 

2020

Revenues:

 

 

 

 

 

Net premiums written (1)

$

385,253

 

 

$

475,352

 

 

$

345,608

 

Escrow, other title-related fees and other

 

52,008

 

 

 

79,585

 

 

 

61,275

 

Investment, dividend and other income

 

2,920

 

 

 

3,106

 

 

 

2,931

 

Total revenues

$

440,181

 

 

$

558,043

 

 

$

409,814

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

Premiums retained by Third-Party Agents (2)

$

261,476

 

 

$

298,445

 

 

$

220,143

 

Title examination expense

 

18,261

 

 

 

22,137

 

 

 

16,204

 

Provision for claims

 

16,740

 

 

 

21,335

 

 

 

15,337

 

Personnel costs

 

259,939

 

 

 

238,134

 

 

 

143,526

 

Other operating expenses

 

93,219

 

 

 

79,951

 

 

 

43,285

 

Goodwill impairment

 

65,207

 

 

 

—

 

 

 

—

 

Long-lived asset impairment

 

32,027

 

 

 

—

 

 

 

—

 

Total operating expenses

$

746,869

 

 

$

660,002

 

 

$

438,495

 

 

 

 

 

 

 

Loss from operations

$

(306,688

)

 

$

(101,959

)

 

$

(28,681

)

 

 

 

 

 

 

Other (expense) income:

 

 

 

 

 

Change in fair value of Warrant and Sponsor Covered Shares liabilities

 

21,317

 

 

 

6,691

 

 

 

—

 

Interest expense

 

(18,080

)

 

 

(16,861

)

 

 

(5,579

)

Loss before income taxes

$

(303,451

)

 

$

(112,129

)

 

$

(34,260

)

 

 

 

 

 

 

Income tax benefit (expense)

 

1,242

 

 

 

(927

)

 

 

(843

)

Net loss

$

(302,209

)

 

$

(113,056

)

 

$

(35,103

)

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

Net loss per share attributable to stockholders - basic and diluted

$

(0.93

)

 

$

(0.64

)

 

$

(0.56

)

Weighted average shares outstanding common stock - basic and diluted

 

326,042,708

 

 

 

177,150,914

 

 

 

62,458,039

 

__________________

(1)

Net premiums written includes revenues from a related party of $134.9 million, $114.2 million, and $88.6 million for the years ended December 31, 2022, 2021, and 2020, respectively.

(2)

Premiums retained by Third-Party Agents includes expenses associated with a related party of $108.4 million, $92.5 million, and $71.2 million during the years ended December 31, 2022, 2021, and 2020, respectively.

 

Doma Holdings, Inc.

Consolidated Balance Sheets

 

 

December 31

(Unaudited - in thousands, except share information)

2022

 

2021

Assets

 

 

 

Cash and cash equivalents

$

78,450

 

 

$

379,702

 

Restricted cash

 

2,933

 

 

 

4,126

 

Investments:

 

 

 

Fixed maturities

 

 

 

Held-to-maturity debt securities, at amortized cost (net of allowance for credit losses of $440 at December 31, 2022 and $0 at December 31, 2021)

 

90,328

 

 

 

67,164

 

Available-for-sale debt securities, at fair value (amortized cost of $59,191 at December 31, 2022 and $0 at December 31, 2021)

 

58,254

 

 

 

—

 

Mortgage loans

 

297

 

 

 

2,022

 

Other invested assets

 

—

 

 

 

325

 

Total investments

$

148,879

 

 

$

69,511

 

Receivables (net of allowance for credit losses of $1,488 and $1,082 at December 31, 2022 and 2021, respectively)

 

21,292

 

 

 

15,498

 

Prepaid expenses, deposits and other assets

 

8,124

 

 

 

15,692

 

Lease right-of-use assets

 

18,634

 

 

 

—

 

Fixed assets (net of accumulated depreciation of $24,532 and $19,543 at December 31, 2022 and 2021, respectively)

 

39,383

 

 

 

45,953

 

Title plants

 

14,533

 

 

 

13,952

 

Goodwill

 

46,280

 

 

 

111,487

 

Total assets

$

378,508

 

 

$

655,921

 

 

 

 

 

Liabilities and stockholders’ equity

 

 

 

Accounts payable

$

2,909

 

 

$

6,930

 

Accrued expenses and other liabilities

 

28,892

 

 

 

54,149

 

Leases liabilities

 

27,489

 

 

 

—

 

Senior secured credit agreement, net of debt issuance costs and original issue discount

 

154,790

 

 

 

141,769

 

Liability for loss and loss adjustment expenses

 

82,070

 

 

 

80,267

 

Warrant liabilities

 

347

 

 

 

16,467

 

Sponsor Covered Shares liability

 

219

 

 

 

5,415

 

Total liabilities

$

296,716

 

 

$

304,997

 

 

 

 

 

Stockholders’ equity:

 

 

 

Common stock, 0.0001 par value; 2,000,000,000 shares authorized at December 31, 2022 and 2021; 329,147,979 and 323,347,806 shares issued and outstanding as of December 31, 2022 and 2021, respectively

 

33

 

 

 

33

 

Additional paid-in capital

 

577,483

 

 

 

543,070

 

Accumulated deficit

 

(494,787

)

 

 

(192,179

)

Accumulated other comprehensive income

 

(937

)

 

 

—

 

Total stockholders’ equity

$

81,792

 

 

$

350,924

 

Total liabilities and stockholders’ equity

$

378,508

 

 

$

655,921

 

Quarterly Results of Operations and Other Data

The following tables set forth our selected unaudited quarterly consolidated statements of operations data for each of the quarters indicated. The information for each quarter has been prepared on a basis consistent with our audited consolidated financial statements, and reflect, in the opinion of management, all adjustments, which consist only of a normal, recurring nature that are necessary for a fair statement of the financial information contained in those financial statements. Our historical results are not necessarily indicative of the results that may be expected in the future. The following quarterly financial data should be read in conjunction with our consolidated financial statements.

Consolidated Statements of Operations

 

Three months ended

(Unaudited - in thousands)

December 31, 2020

 

March 31, 2021

 

June 30, 2021

 

September 30, 2021

 

December 31, 2021

 

March 31, 2022

 

June 30, 2022

 

September 30, 2022

 

December 31, 2022

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net premiums written

$

98,870

 

 

$

107,992

 

 

$

109,271

 

 

$

141,491

 

 

$

116,598

 

 

$

95,666

 

 

$

108,926

 

 

$

94,488

 

 

$

86,173

 

Escrow, other title-related fees and other

 

17,977

 

 

 

18,575

 

 

 

20,065

 

 

 

20,452

 

 

 

20,493

 

 

 

16,113

 

 

 

14,366

 

 

 

12,627

 

 

 

8,902

 

Investment, dividend and other income

 

663

 

 

 

1,229

 

 

 

650

 

 

 

639

 

 

 

588

 

 

 

428

 

 

 

452

 

 

 

741

 

 

 

1,299

 

Total revenues

$

117,510

 

 

$

127,796

 

 

$

129,986

 

 

$

162,582

 

 

$

137,679

 

 

$

112,207

 

 

$

123,744

 

 

$

107,856

 

 

$

96,374

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Premiums retained by Third-Party Agents

$

64,011

 

 

$

70,338

 

 

$

65,181

 

 

$

91,596

 

 

$

71,330

 

 

$

60,602

 

 

$

74,638

 

 

$

65,141

 

 

$

61,095

 

Title examination expense

 

4,393

 

 

 

4,853

 

 

 

5,500

 

 

 

5,289

 

 

 

6,495

 

 

 

5,981

 

 

 

5,146

 

 

 

3,709

 

 

 

3,425

 

Provision for claims

 

5,272

 

 

 

3,249

 

 

 

6,807

 

 

 

6,685

 

 

 

4,594

 

 

 

4,611

 

 

 

6,310

 

 

 

4,665

 

 

 

1,154

 

Personnel costs

 

38,874

 

 

 

43,464

 

 

 

53,954

 

 

 

62,410

 

 

 

78,306

 

 

 

77,793

 

 

 

73,233

 

 

 

60,481

 

 

 

48,432

 

Other operating expenses

 

12,149

 

 

 

14,165

 

 

 

17,181

 

 

 

21,693

 

 

 

26,912

 

 

 

22,754

 

 

 

23,637

 

 

 

20,656

 

 

 

26,172

 

Goodwill impairment

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

33,746

 

 

 

31,461

 

Long-lived asset impairment

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

32,027

 

Total operating expenses

$

124,699

 

 

$

136,069

 

 

$

148,623

 

 

$

187,673

 

 

$

187,637

 

 

$

171,741

 

 

$

182,964

 

 

$

188,398

 

 

$

203,766

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from operations

$

(7,189

)

 

$

(8,273

)

 

$

(18,637

)

 

$

(25,091

)

 

$

(49,958

)

 

$

(59,534

)

 

$

(59,220

)

 

$

(80,542

)

 

$

(107,392

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in fair value of warrant and Sponsor Covered Shares liabilities

 

—

 

 

 

—

 

 

 

—

 

 

 

(4,478

)

 

 

11,169

 

 

 

13,900

 

 

 

5,193

 

 

 

1,438

 

 

 

786

 

Interest expense

 

(1,151

)

 

 

(3,360

)

 

 

(4,451

)

 

 

(4,531

)

 

 

(4,519

)

 

 

(4,207

)

 

 

(4,489

)

 

 

(4,584

)

 

 

(4,800

)

Loss before income taxes

$

(8,340

)

 

$

(11,633

)

 

$

(23,088

)

 

$

(34,100

)

 

$

(43,308

)

 

$

(49,841

)

 

$

(58,516

)

 

$

(83,688

)

 

$

(111,406

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax benefit (expense)

 

(223

)

 

 

(125

)

 

 

(211

)

 

 

(170

)

 

 

(421

)

 

 

(185

)

 

 

(136

)

 

 

(425

)

 

 

1,988

 

Net loss

$

(8,563

)

 

$

(11,758

)

 

$

(23,299

)

 

$

(34,270

)

 

$

(43,729

)

 

$

(50,026

)

 

$

(58,652

)

 

$

(84,113

)

 

$

(109,418

)

Reconciliation of GAAP to Non-GAAP Measures

The following tables present our reconciliation of GAAP measures to non-GAAP measures for the historical periods indicated.

Retained premiums and fees

 

Three Months Ended

(Unaudited - in thousands)

December 31, 2020

 

March 31, 2021

 

June 30, 2021

 

September 30, 2021

 

December 31, 2021

 

March 31, 2022

 

June 30, 2022

 

September 30, 2022

 

December 31, 2022

Revenue

$

117,510

 

$

127,796

 

$

129,986

 

$

162,582

 

$

137,679

 

$

112,207

 

$

123,744

 

$

107,856

 

$

96,374

Minus:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Premiums retained by Third-Party Agents

 

64,011

 

 

70,338

 

 

65,181

 

 

91,596

 

 

71,330

 

 

60,602

 

 

74,638

 

 

65,141

 

 

61,095

Retained premiums and fees

$

53,499

 

$

57,458

 

$

64,805

 

$

70,986

 

$

66,349

 

$

51,605

 

$

49,106

 

$

42,715

 

$

35,279

Minus:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct labor

 

17,050

 

 

17,979

 

 

20,902

 

 

23,948

 

 

26,787

 

 

27,798

 

 

23,890

 

 

20,220

 

 

14,665

Provision for claims

 

5,272

 

 

3,249

 

 

6,807

 

 

6,685

 

 

4,594

 

 

4,611

 

 

6,310

 

 

4,665

 

 

1,154

Depreciation and amortization

 

2,579

 

 

2,707

 

 

3,021

 

 

1,978

 

 

2,615

 

 

3,236

 

 

3,747

 

 

4,251

 

 

4,785

Other direct costs(1)

 

4,186

 

 

7,109

 

 

7,561

 

 

10,073

 

 

10,322

 

 

8,826

 

 

8,016

 

 

6,224

 

 

5,478

Gross Profit

$

24,412

 

$

26,414

 

$

26,514

 

$

28,302

 

$

22,031

 

$

7,134

 

$

7,143

 

$

7,355

 

$

9,197

________________
(1)

Includes title examination expense, office supplies, and premium and other taxes.

Adjusted gross profit

 

Three Months Ended

(Unaudited - in thousands)

December 31, 2020

 

March 31, 2021

 

June 30, 2021

 

September 30, 2021

 

December 31, 2021

 

March 31, 2022

 

June 30, 2022

 

September 30, 2022

 

December 31, 2022

Gross Profit

$

24,412

 

$

26,414

 

$

26,514

 

$

28,302

 

$

22,031

 

$

7,134

 

$

7,143

 

$

7,355

 

$

9,197

Adjusted for:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

2,579

 

 

2,707

 

 

3,021

 

 

1,978

 

 

2,615

 

 

3,236

 

 

3,747

 

 

4,251

 

 

4,785

Adjusted Gross Profit

$

26,991

 

$

29,121

 

$

29,535

 

$

30,280

 

$

24,646

 

$

10,370

 

$

10,890

 

$

11,606

 

$

13,982

Adjusted EBITDA

 

Three Months Ended

(Unaudited - in thousands)

December 31, 2020

 

March 31, 2021

 

June 30, 2021

 

September 30, 2021

 

December 31, 2021

 

March 31, 2022

 

June 30, 2022

 

September 30, 2022

 

December 31, 2022

Net loss (GAAP)

$

(8,563

)

 

$

(11,758

)

 

$

(23,299

)

 

$

(34,270

)

 

$

(43,729

)

 

$

(50,026

)

 

$

(58,652

)

 

$

(84,113

)

 

$

(109,418

)

Adjusted for:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

2,579

 

 

 

2,707

 

 

 

3,021

 

 

 

1,978

 

 

 

2,615

 

 

 

3,236

 

 

 

3,747

 

 

 

4,251

 

 

 

4,785

 

Interest expense

 

1,151

 

 

 

3,360

 

 

 

4,451

 

 

 

4,531

 

 

 

4,519

 

 

 

4,207

 

 

 

4,489

 

 

 

4,584

 

 

 

4,800

 

Income taxes

 

223

 

 

 

125

 

 

 

211

 

 

 

170

 

 

 

421

 

 

 

185

 

 

 

136

 

 

 

425

 

 

 

(1,988

)

EBITDA

$

(4,610

)

 

$

(5,566

)

 

$

(15,616

)

 

$

(27,591

)

 

$

(36,174

)

 

$

(42,398

)

 

$

(50,280

)

 

$

(74,853

)

 

$

(101,821

)

Adjusted for:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation

 

1,550

 

 

 

2,289

 

 

 

3,713

 

 

 

3,004

 

 

 

11,040

 

 

 

11,393

 

 

 

8,255

 

 

 

7,746

 

 

 

6,293

 

Severance costs

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

3,828

 

 

 

4,567

 

 

 

11,218

 

Goodwill impairment

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

33,746

 

 

 

31,461

 

Long-lived asset impairment

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

32,027

 

Change in fair value of warrant and Sponsor Covered Shares liabilities

 

—

 

 

 

—

 

 

 

—

 

 

 

4,478

 

 

 

(11,169

)

 

 

(13,900

)

 

 

(5,193

)

 

 

(1,438

)

 

 

(786

)

Accelerated contract expense

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

5,221

 

Adjusted EBITDA

$

(3,060

)

 

$

(3,277

)

 

$

(11,903

)

 

$

(20,109

)

 

$

(36,303

)

 

$

(44,905

)

 

$

(43,390

)

 

$

(30,232

)

 

$

(16,387

)

 

Investor Contact: Matt Thunander | Head of Investor Relations for Doma | ir@doma.com

Media Contact: Camilla Whitmore | Lead, Public Relations for Doma | press@doma.com

Source: Doma Holdings, Inc.