Blackbaud Newsroom

Blackbaud Announces 2019 Third Quarter Results

  • by Blackbaud
  • Oct 28, 2019, 08:10 PM
blackbaud-peer-to-peer

Third Quarter Recurring Revenue Grows 9%; Reaffirms 2019 Financial Guidance

Charleston, S.C. (October 28, 2019) - Blackbaud (NASDAQ: BLKB), the world's leading cloud software company powering social good, today announced financial results for its third quarter ended September 30, 2019.

"We continue to gain momentum in our aim to delight customers through innovative cloud solutions, and it is clear that the progress we've made is resonating with the individuals that use our solutions every day. Earlier this month, we hosted a record number of attendees at the 20th annual bbcon, the premier tech gathering for organizations focused on the latest trends and innovations driving the social good community forward," said Mike Gianoni, Blackbaud's president and CEO. "Among the many product and innovation updates across all of our vertical markets, we announced the general availability of Blackbaud Church Management™, which is already transforming the church technology landscape. Within just one year of announcing plans for Blackbaud Church Management, we now serve churches in more than half of the 50 U.S. states, representing congregations of all different sizes and spanning more than 10 denominations. This pace of innovation is extraordinary in our industry."

Third Quarter 2019 Results Compared to Third Quarter 2018 Results: 

  • Total GAAP revenue was $221.1 million, up 5.5%, with $205.2 million in GAAP recurring revenue, representing 92.8% of total GAAP revenue. GAAP recurring revenue was up 8.8%. 

  • Total non-GAAP revenue was $221.4 million, up 5.4%, with $205.5 million in non-GAAP recurring revenue, representing 92.8% of total non-GAAP revenue. Non-GAAP recurring revenue was up 8.6%. 

  • Non-GAAP organic recurring revenue increased 5.6%. 

  • GAAP income from operations was $7.9 million, with GAAP operating margin of 3.6%, a decrease of 390 basis points. 

  • Non-GAAP income from operations was $36.6 million, with non-GAAP operating margin of 16.5%, a decrease of 240 basis points. 

  • GAAP net income was $4.6 million, with GAAP diluted earnings per share of $0.09, down $0.14. 

  • Non-GAAP net income was $26.9 million, with non-GAAP diluted earnings per share of $0.56, down $0.03. 

  • Non-GAAP free cash flow was $62.5 million, an increase of $4.7 million.

"We've posted solid recurring revenue growth through the first three quarters of the year, and anticipate carrying that performance through the end of 2019," said Tony Boor, Blackbaud's executive vice president and CFO. "The investments we're making in innovation are delivering tremendous value for our existing customers and we've created entirely new product opportunities in our Higher Education and Faith verticals. The investments into sales and marketing are improving our ability to scale, increase our selling footprint, and position us to drive future growth. We're planning to continue these heightened investments though the end of the year."

An explanation of all non-GAAP financial measures referenced in this press release is included below under the heading "Non-GAAP Financial Measures." A reconciliation of the company's non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release.  

Recent Company Highlights:  

Visit www.blackbaud.com/newsroom for more information about Blackbaud’s recent highlights.

Dividend
Blackbaud announced today that its Board of Directors has declared a fourth quarter 2019 dividend of $0.12 per share payable on December 13, 2019 to stockholders of record on November 27, 2019.

Financial Outlook
Blackbaud today reaffirmed its 2019 full year financial guidance:

  • Non-GAAP revenue of $880 million to $910 million 

  • Non-GAAP operating margin of 16.7% to 17.2% 

  • Non-GAAP diluted earnings per share of $2.11 to $2.28 

  • Non-GAAP free cash flow of $124 million to $134 million

Blackbaud has not reconciled forward-looking full-year non-GAAP financial measures contained in this news release to their most directly comparable GAAP measures, as permitted by Item 10(e)(1)(i)(B) of Regulation S-K. Such reconciliations would require unreasonable efforts at this time to estimate and quantify with a reasonable degree of certainty various necessary GAAP components, including for example those related to compensation, acquisition transactions and integration, tax items or others that may arise during the year. These components and other factors could materially impact the amount of the future directly comparable GAAP measures, which may differ significantly from their non-GAAP counterparts.

Adoption of New Lease Accounting Standard
On January 1, 2019, we adopted Financial Accounting Standards Board ("FASB") Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842) ("ASU 2016-02"), using the transition method that allowed us to initially apply the guidance at the adoption date of January 1, 2019 without adjusting comparative periods presented. ASU 2016-02 requires lessees to record most leases on their balance sheet but recognize expenses in the income statement in a manner similar to previous guidance. The impacts of adoption are reflected in Blackbaud's guidance and other financial information herein. We have provided more detailed information regarding the impact of our adoption of ASU 2016-02 in our Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 3, 2019.

Conference Call Details
What: Blackbaud's 2019 Third Quarter Conference Call
When:October 29, 2019
Time: 8:00 a.m. (Eastern Time)
Live Call: 800-289-0459 (US/Canada); passcode 357233
Webcast:Blackbaud's Investor Relations Webpage

About Blackbaud
Blackbaud (NASDAQ: BLKB) is the world’s leading cloud software company powering social good. Serving the entire social good community—nonprofits, foundations, companies, education institutions, healthcare organizations and individual change agents—Blackbaud connects and empowers organizations to increase their impact through cloud software, services, expertise and data intelligence. The Blackbaud portfolio is tailored to the unique needs of vertical markets, with solutions for fundraising and CRM, marketing, advocacy, peer-to-peer fundraising, corporate social responsibility, school management, ticketing, grantmaking, financial management, payment processing and analytics. Serving the industry for more than three decades, Blackbaud is headquartered in Charleston, South Carolina and has operations in the United States, Australia, Canada, Costa Rica and the United Kingdom. For more information, visit www.blackbaud.com, or follow us on Twitter, LinkedIn, and Facebook

Investor Contact:

Media Contact:

Steve Hufford

Director of Investor Relations

843-654-2655

Forward-Looking Statements
Except for historical information, all of the statements, expectations, and assumptions contained in this news release are forward-looking statements which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding: the predictability of our financial results, expectations that our revenue will continue to grow, and expectations that we will achieve our projected 2019 full-year financial guidance. These statements involve a number of risks and uncertainties. Although Blackbaud attempts to be accurate in making these forward-looking statements, it is possible that future circumstances might differ from the assumptions on which such statements are based. In addition, other important factors that could cause results to differ materially include the following: management of integration of acquired companies; uncertainty regarding increased business and renewals from existing customers; a shifting revenue mix that may impact gross margin; continued success in sales growth; risks related to our dividend policy and stock repurchase program, including the possibility that we might discontinue payment of dividends; and the other risk factors set forth from time to time in the SEC filings for Blackbaud, copies of which are available free of charge at the SEC’s website at www.sec.gov or upon request from Blackbaud's investor relations department. Blackbaud assumes no obligation and does not intend to update these forward-looking statements, except as required by law.

Trademarks
All Blackbaud product names appearing herein are trademarks or registered trademarks of Blackbaud, Inc.

Non-GAAP Financial Measures
Blackbaud has provided in this release financial information that has not been prepared in accordance with GAAP. This information includes non-GAAP revenue, non-GAAP recurring revenue, non-GAAP gross profit, non-GAAP gross margin, non-GAAP income from operations, non-GAAP operating margin, non-GAAP net income and non-GAAP diluted earnings per share. Blackbaud has acquired businesses whose net tangible assets include deferred revenue. In accordance with GAAP reporting requirements, Blackbaud recorded write-downs of deferred revenue to fair value, which resulted in lower recognized revenue. Both on a quarterly and year-to-date basis, the revenue for the acquired businesses is deferred and typically recognized over a one-year period, so Blackbaud's GAAP revenues for the one-year period after the acquisitions will not reflect the full amount of revenues that would have been reported if the acquired deferred revenue was not written down to fair value. The non-GAAP measures described above reverse the acquisition-related deferred revenue write-downs so that the full amount of revenue booked by the acquired companies is included, which Blackbaud believes provides a more accurate representation of a revenue run-rate in a given period. In addition to reversing write-downs of acquisition-related deferred revenue, non-GAAP financial measures discussed above exclude the impact of certain items that Blackbaud believes are not directly related to its performance in any particular period, but are for its long-term benefit over multiple periods.

In addition, Blackbaud uses non-GAAP organic revenue growth, non-GAAP organic revenue growth on a constant currency basis and non-GAAP organic recurring revenue growth, in analyzing its operating performance. Blackbaud believes that these non-GAAP measures are useful to investors, as a supplement to GAAP measures, for evaluating the periodic growth of its business on a consistent basis. Each of these measures excludes incremental acquisition-related revenue attributable to companies acquired in the current fiscal year. For companies acquired in the immediately preceding fiscal year, each of these measures reflects presentation of full-year incremental non-GAAP revenue derived from such companies as if they were combined throughout the prior period, and it includes the non-GAAP revenue attributable to those companies, as if there were no acquisition-related write-downs of acquired deferred revenue to fair value as required by GAAP. In addition, each of these measures excludes prior period revenue associated with divested businesses. The exclusion of the prior period revenue is to present the results of the divested businesses within the results of the combined company for the same period of time in both the prior and current periods. Blackbaud believes this presentation provides a more comparable representation of its current business’ organic revenue growth and revenue run-rate.

Non-GAAP free cash flow is defined as operating cash flow less capital expenditures, including costs required to be capitalized for software development, and capital expenditures for property and equipment.

Blackbaud uses these non-GAAP financial measures internally in analyzing its financial results and believes they are useful to investors, as a supplement to GAAP measures, in evaluating Blackbaud's ongoing operational performance. Blackbaud believes that these non-GAAP financial measures reflect Blackbaud's ongoing business in a manner that allows for meaningful period-to-period comparison and analysis of trends in its business. In addition, Blackbaud believes that the use of these non-GAAP financial measures provides additional information for investors to use in evaluating ongoing operating results and trends and in comparing its financial results from period-to-period with other companies in Blackbaud's industry, many of which present similar non-GAAP financial measures to investors. However, these non-GAAP financial measures may not be completely comparable to similarly titled measures of other companies due to differences in the exact method of calculation between companies. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures.

 

(dollars in thousands)

September 30,
2019

December 31,
2018

Assets

 

 

Current assets:

 

 

Cash and cash equivalents

$

29,084

 

$

30,866

 

Restricted cash due to customers

243,056

 

418,980

 

Accounts receivable, net of allowance of $4,791 and $4,722 at September 30, 2019 and December 31, 2018, respectively

90,700

 

86,595

 

Customer funds receivable

7,784

 

1,753

 

Prepaid expenses and other current assets

75,321

 

59,788

 

Total current assets

445,945

 

597,982

 

Property and equipment, net

37,285

 

40,031

 

Operating lease right-of-use assets

110,840

 

 

Software development costs, net

94,055

 

75,099

 

Goodwill

630,644

 

545,213

 

Intangible assets, net

327,089

 

291,617

 

Other assets

64,154

 

65,363

 

Total assets

$

1,710,012

 

$

1,615,305

 

Liabilities and stockholders’ equity

 

 

Current liabilities:

 

 

Trade accounts payable

$

34,169

 

$

34,538

 

Accrued expenses and other current liabilities

63,947

 

46,893

 

Due to customers

250,840

 

420,733

 

Debt, current portion

7,500

 

7,500

 

Deferred revenue, current portion

320,982

 

295,991

 

Total current liabilities

677,438

 

805,655

 

Debt, net of current portion

495,556

 

379,624

 

Deferred tax liability

47,237

 

44,291

 

Deferred revenue, net of current portion

2,014

 

2,564

 

Operating lease liabilities, net of current portion

100,133

 

 

Other liabilities

6,177

 

9,388

 

Total liabilities

1,328,555

 

1,241,522

 

Commitments and contingencies

 

 

Stockholders’ equity:

 

 

Preferred stock; 20,000,000 shares authorized, none outstanding

 

 

Common stock, $0.001 par value; 180,000,000 shares authorized, 60,207,091 and 59,327,633 shares issued at September 30, 2019 and December 31, 2018, respectively

60

 

59

 

Additional paid-in capital

442,803

 

399,241

 

Treasury stock, at cost; 11,022,799 and 10,760,574 shares at September 30, 2019 and December 31, 2018, respectively

(287,163

)

(266,884

)

Accumulated other comprehensive loss

(13,665

)

(5,110

)

Retained earnings

239,422

 

246,477

 

Total stockholders’ equity

381,457

 

373,783

 

Total liabilities and stockholders’ equity

$

1,710,012

 

$

1,615,305

 


(dollars in thousands, except per share amounts)

Three months ended
September 30,

 

Nine months ended
September 30,

2019

2018

 

2019

2018

Revenue

 

 

 

 

 

Recurring

$

205,227

 

$

188,656

 

 

$

611,789

 

$

562,251

 

One-time services and other

15,893

 

20,876

 

 

50,795

 

65,137

 

Total revenue

221,120

 

209,532

 

 

662,584

 

627,388

 

Cost of revenue

 

 

 

 

 

Cost of recurring

87,645

 

76,535

 

 

259,013

 

221,964

 

Cost of one-time services and other

14,152

 

18,702

 

 

42,874

 

56,482

 

Total cost of revenue

101,797

 

95,237

 

 

301,887

 

278,446

 

Gross profit

119,323

 

114,295

 

 

360,697

 

348,942

 

Operating expenses

 

 

 

 

 

Sales, marketing and customer success

55,499

 

49,077

 

 

165,963

 

143,047

 

Research and development

25,941

 

24,218

 

 

80,304

 

75,473

 

General and administrative

28,897

 

24,894

 

 

84,557

 

78,392

 

Amortization

703

 

1,237

 

 

3,231

 

3,707

 

Restructuring

400

 

(914

)

 

3,083

 

3,585

 

Total operating expenses

111,440

 

98,512

 

 

337,138

 

304,204

 

Income from operations

7,883

 

15,783

 

 

23,559

 

44,738

 

Interest expense

(5,111

)

(4,140

)

 

(16,233

)

(11,960

)

Other income (expense), net

2,158

 

(147

)

 

4,521

 

359

 

Income before provision for income taxes

4,930

 

11,496

 

 

11,847

 

33,137

 

Income tax provision (benefit)

364

 

332

 

 

1,263

 

(2,370

)

Net income

$

4,566

 

$

11,164

 

 

$

10,584

 

$

35,507

 

Earnings per share

 

 

 

 

 

Basic

$

0.10

 

$

0.24

 

 

$

0.22

 

$

0.75

 

Diluted

$

0.09

 

$

0.23

 

 

$

0.22

 

$

0.74

 

Common shares and equivalents outstanding

 

 

 

 

 

Basic weighted average shares

47,757,769

 

47,279,591

 

 

47,668,235

 

47,174,903

 

Diluted weighted average shares

48,464,529

 

48,160,146

 

 

48,223,712

 

48,074,698

 

Other comprehensive (loss) income

 

 

 

 

 

Foreign currency translation adjustment

(3,893

)

1,047

 

 

(5,321

)

(1,333

)

Unrealized (loss) gain on derivative instruments, net of tax

(363

)

566

 

 

(3,234

)

2,410

 

Total other comprehensive (loss) income

(4,256

)

1,613

 

 

(8,555

)

1,077

 

Comprehensive income

$

310

 

$

12,777

 

 

$

2,029

 

$

36,584

 


 

Nine months ended
September 30,

(dollars in thousands)

2019

2018

Cash flows from operating activities

 

 

Net income

$

10,584

 

$

35,507

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

Depreciation and amortization

63,998

 

59,993

 

Provision for doubtful accounts and sales returns

6,192

 

4,760

 

Stock-based compensation expense

43,621

 

35,683

 

Deferred taxes

(75

)

1,430

 

Amortization of deferred financing costs and discount

564

 

564

 

Other non-cash adjustments

2,047

 

(2,085

)

Changes in operating assets and liabilities, net of acquisition and disposal of businesses:

 

 

Accounts receivable

(6,375

)

(4,480

)

Prepaid expenses and other assets

(5,129

)

(12,372

)

Trade accounts payable

(74

)

(134

)

Accrued expenses and other liabilities

(13,592

)

(6,923

)

Deferred revenue

20,363

 

25,888

 

Net cash provided by operating activities

122,124

 

137,831

 

Cash flows from investing activities

 

 

Purchase of property and equipment

(9,597

)

(12,910

)

Capitalized software development costs

(34,513

)

(26,629

)

Purchase of net assets of acquired companies, net of cash and restricted cash acquired

(109,353

)

(45,315

)

Other investing activities

500

 

 

Net cash used in investing activities

(152,963

)

(84,854

)

Cash flows from financing activities

 

 

Proceeds from issuance of debt

371,200

 

219,900

 

Payments on debt

(255,625

)

(233,225

)

Employee taxes paid for withheld shares upon equity award settlement

(20,279

)

(27,398

)

Proceeds from exercise of stock options

7

 

11

 

Change in due to customers

(215,942

)

(425,218

)

Change in customer funds receivable

(6,283

)

(4,371

)

Dividend payments to stockholders

(17,705

)

(17,484

)

Net cash used in financing activities

(144,627

)

(487,785

)

Effect of exchange rate on cash, cash equivalents and restricted cash

(2,240

)

(285

)

Net decrease in cash, cash equivalents and restricted cash

(177,706

)

(435,093

)

Cash, cash equivalents and restricted cash, beginning of period

449,846

 

640,174

 

Cash, cash equivalents and restricted cash, end of period

$

272,140

 

$

205,081

 

The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown above in the consolidated statements of cash flows:

(dollars in thousands)

September 30,
2019

December 31,
2018

Cash and cash equivalents

$

29,084

 

$

30,866

 

Restricted cash due to customers

243,056

 

418,980

 

Total cash, cash equivalents and restricted cash in the statement of cash flows

$

272,140

 

$

449,846

 


(dollars in thousands, except per share amounts)

Three months ended
September 30,

 

Nine months ended
September 30,

2019

2018

 

2019

2018

GAAP Revenue

$

221,120

 

$

209,532

 

 

$

662,584

 

$

627,388

 

Non-GAAP adjustments:

 

 

 

 

 

Add: Acquisition-related deferred revenue write-down

259

 

571

 

 

1,691

 

1,838

 

Non-GAAP revenue

$

221,379

 

$

210,103

 

 

$

664,275

 

$

629,226

 

 

 

 

 

 

 

GAAP gross profit

$

119,323

 

$

114,295

 

 

$

360,697

 

$

348,942

 

GAAP gross margin

54.0

%

54.5

%

 

54.4

%

55.6

%

Non-GAAP adjustments:

 

 

 

 

 

Add: Acquisition-related deferred revenue write-down

259

 

571

 

 

1,691

 

1,838

 

Add: Stock-based compensation expense

784

 

1,270

 

 

2,549

 

4,010

 

Add: Amortization of intangibles from business combinations

11,225

 

10,625

 

 

33,970

 

31,688

 

Add: Employee severance

19

 

279

 

 

1,134

 

866

 

Add: Acquisition-related integration costs

 

 

 

 

25

 

Subtotal

12,287

 

12,745

 

 

39,344

 

38,427

 

Non-GAAP gross profit

$

131,610

 

$

127,040

 

 

$

400,041

 

$

387,369

 

Non-GAAP gross margin

59.5

%

60.5

%

 

60.2

%

61.6

%

 

 

 

 

 

 

GAAP income from operations

$

7,883

 

$

15,783

 

 

$

23,559

 

$

44,738

 

GAAP operating margin

3.6

%

7.5

%

 

3.6

%

7.1

%

Non-GAAP adjustments:

 

 

 

 

 

Add: Acquisition-related deferred revenue write-down

259

 

571

 

 

1,691

 

1,838

 

Add: Stock-based compensation expense

14,866

 

10,730

 

 

43,621

 

35,683

 

Add: Amortization of intangibles from business combinations

11,928

 

11,862

 

 

37,201

 

35,395

 

Add: Employee severance

48

 

682

 

 

3,660

 

1,713

 

Add: Acquisition-related integration costs

1,024

 

756

 

 

2,206

 

3,383

 

Add: Acquisition-related expenses

220

 

269

 

 

1,030

 

1,874

 

Add: Restructuring costs

400

 

(914

)

 

3,083

 

3,585

 

Subtotal

28,745

 

23,956

 

 

92,492

 

83,471

 

Non-GAAP income from operations

$

36,628

 

$

39,739

 

 

$

116,051

 

$

128,209

 

Non-GAAP operating margin

16.5

%

18.9

%

 

17.5

%

20.4

%

 

 

 

 

 

 

GAAP income before provision for income taxes

$

4,930

 

$

11,496

 

 

$

11,847

 

$

33,137

 

GAAP net income

$

4,566

 

$

11,164

 

 

$

10,584

 

$

35,507

 

 

 

 

 

 

 

Shares used in computing GAAP diluted earnings per share

48,464,529

 

48,160,146

 

 

48,223,712

 

48,074,698

 

GAAP diluted earnings per share

$

0.09

 

$

0.23

 

 

$

0.22

 

$

0.74

 

 

 

 

 

 

 

Non-GAAP adjustments:

 

 

 

 

 

Add: GAAP income tax provision (benefit)

364

 

332

 

 

1,263

 

(2,370

)

Add: Total non-GAAP adjustments affecting income from operations

28,745

 

23,956

 

 

92,492

 

83,471

 

Non-GAAP income before provision for income taxes

33,675

 

35,452

 

 

104,339

 

116,608

 

Assumed non-GAAP income tax provision(1)

6,735

 

7,090

 

 

$

20,868

 

$

23,322

 

Non-GAAP net income

$

26,940

 

$

28,362

 

 

$

83,471

 

$

93,286

 

 

 

 

 

 

 

Shares used in computing non-GAAP diluted earnings per share

48,464,529

 

48,160,146

 

 

48,223,712

 

48,074,698

 

Non-GAAP diluted earnings per share

$

0.56

 

$

0.59

 

 

$

1.73

 

$

1.94

 

  1. Blackbaud applies a non-GAAP effective tax rate of 20.0% when calculating non-GAAP net income and non-GAAP diluted earnings per share.


(dollars in thousands)

Three months ended
September 30,

 

Nine months ended
September 30,

2019

2018

 

2019

2018

GAAP revenue

$

221,120

 

$

209,532

 

 

$

662,584

 

$

627,388

 

GAAP revenue growth

5.5

%

 

 

5.6

%

 

(Less) Add: Non-GAAP acquisition-related revenue (1)

(5,250

)

571

 

 

(14,194

)

5,056

 

Non-GAAP organic revenue (2)

$

215,870

 

$

210,103

 

 

$

648,390

 

$

632,444

 

Non-GAAP organic revenue growth

2.7

%

 

 

2.5

%

 

 

 

 

 

 

 

Non-GAAP organic revenue (2)

$

215,870

 

$

210,103

 

 

$

648,390

 

$

632,444

 

Foreign currency impact on non-GAAP organic revenue (3)

1,457

 

 

 

5,413

 

 

Non-GAAP organic revenue on constant currency basis (3)

$

217,327

 

$

210,103

 

 

$

653,803

 

$

632,444

 

Non-GAAP organic revenue growth on constant currency basis

3.4

%

 

 

3.4

%

 

 

 

 

 

 

 

GAAP recurring revenue

$

205,227

 

$

188,656

 

 

$

611,789

 

$

562,251

 

GAAP recurring revenue growth

8.8

%

 

 

8.8

%

 

(Less) Add: Non-GAAP acquisition-related revenue (1)

(5,490

)

571

 

 

(13,963

)

4,887

 

Non-GAAP organic recurring revenue

$

199,737

 

$

189,227

 

 

$

597,826

 

$

567,138

 

Non-GAAP organic recurring revenue growth

5.6

%

 

 

5.4

%

 

  1. Non-GAAP acquisition-related revenue excludes incremental acquisition-related revenue calculated in accordance with GAAP that is attributable to companies acquired in the current fiscal year. For companies acquired in the immediately preceding fiscal year, non-GAAP acquisition-related revenue reflects presentation of full-year incremental non-GAAP revenue derived from such companies, as if they were combined throughout the prior period, and it includes the non-GAAP revenue from the acquisition-related deferred revenue write-down attributable to those companies.
  2. Non-GAAP organic revenue for the prior year periods presented herein may not agree to non-GAAP organic revenue presented in the respective prior period quarterly financial information solely due to the manner in which non-GAAP organic revenue growth is calculated.
  3. To determine non-GAAP organic revenue growth on a constant currency basis, revenues from entities reporting in foreign currencies were translated to U.S. Dollars using the comparable prior period's quarterly weighted average foreign currency exchange rates. The primary foreign currencies creating the impact are the Canadian Dollar, EURO, British Pound and Australian Dollar.

 

(dollars in thousands)

Nine months ended
September 30,

2019

2018

GAAP net cash provided by operating activities

$

122,124

 

$

137,831

 

Less: purchase of property and equipment

(9,597

)

(12,910

)

Less: capitalized software development costs

(34,513

)

(26,629

)

Non-GAAP free cash flow

$

78,014

 

$

98,292

 

 

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