clvt-20240331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to _______

Commission File No. 001-38911

CLARIVATE PLC

(Exact name of registrant as specified in its charter)


Jersey, Channel Islands			N/A
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
70 St. Mary Axe London EC3A 8BE United Kingdom (Address of principal executive offices)			Not applicable (Zip Code)

Registrant’s telephone number, including area code: +44 207 4334000

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Ordinary Shares, no par value	CLVT	New York Stock Exchange
5.25% Series A Mandatory Convertible Preferred Shares, no par value	CLVT PR A	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,”

“accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934). Yes ☐ No ☒

The number of ordinary shares of the Company outstanding as of April 30, 2024, was 668,237,610.


			Page
Part I. Financial Information			5
Item 1. Financial Statements (Unaudited)			5
Condensed Consolidated Balance Sheets			5
Condensed Consolidated Statements of Operations			6
Condensed Consolidated Statements of Comprehensive Income (Loss)			7
Condensed Consolidated Statements of Changes in Equity			8
Condensed Consolidated Statements of Cash Flows			9
Notes to the Condensed Consolidated Financial Statements			10
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			21
Item 3. Quantitative and Qualitative Disclosures About Market Risk			28
Item 4. Controls and Procedures			28

Part II. Other Information			29
Item 1. Legal Proceedings			29
Item 1A. Risk Factors			29
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			29
Item 5. Other Information			29
Item 6. Exhibits			30

Signature			30



(In millions)	March 31, 2024		December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents, including restricted cash	$	361.8	$	370.7

Accounts receivable, net	822.9		908.3
Prepaid expenses	100.0		88.5
Other current assets	67.9		68.0
Assets held for sale	38.2		26.7
Total current assets	1,390.8		1,462.2
Property and equipment, net	49.2		51.6
Other intangible assets, net	8,874.2		9,006.6
Goodwill	2,023.4		2,023.7
Other non-current assets	68.5		60.8
Deferred income taxes	46.6		46.7
Operating lease right-of-use assets	52.0		55.2
Total assets	$	12,504.7	$	12,706.8
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	102.7	$	144.1
Accrued compensation	85.8		126.5
Accrued expenses and other current liabilities	365.1		315.2
Current portion of deferred revenues	1,010.1		983.1
Current portion of operating lease liability	24.3		24.4
Liabilities held for sale	26.8		6.7
Total current liabilities	1,614.8		1,600.0
Long-term debt	4,637.9		4,721.1

Non-current portion of deferred revenues	17.7		38.7
Other non-current liabilities	41.7		41.9
Deferred income taxes	246.2		249.6
Operating lease liabilities	58.0		63.2
Total liabilities	6,616.3		6,714.5
Commitments and contingencies (Note 14)
Shareholders' equity:
Preferred Shares, no par value; 14.4 shares authorized; 5.25% Mandatory Convertible Preferred Shares, Series A, 14.4 shares issued and outstanding as of both March 31, 2024 and December 31, 2023	1,392.6		1,392.6
Ordinary Shares, no par value; unlimited shares authorized; 668.2 and 666.1 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively	11,747.4		11,740.5

Accumulated other comprehensive loss	(512.3)		(495.3)
Accumulated deficit	(6,739.3)		(6,645.5)
Total shareholders' equity	5,888.4		5,992.3
Total liabilities and shareholders' equity	$	12,504.7	$	12,706.8


	Three Months Ended March 31,
(In millions, except per share data)	2024		2023
Revenues	$	621.2	$	629.1
Operating expenses:
Cost of revenues	217.8		229.7
Selling, general and administrative costs	191.9		194.8
Depreciation and amortization	179.4		172.6

Restructuring	9.5		9.4
Other operating expense (income), net	17.6		(32.0)
Total operating expenses	616.2		574.5
Income (loss) from operations	5.0		54.6
Fair value adjustment of warrants	(5.2)		1.1
Interest expense, net	70.2		73.6
Income (loss) before income tax	(60.0)		(20.1)
Provision (benefit) for income taxes	15.0		(63.6)
Net income (loss)	(75.0)		43.5
Dividends on preferred shares	18.8		18.8
Net income (loss) attributable to ordinary shares	$	(93.8)	$	24.7

Per share:
Basic	$	(0.14)	$	0.04
Diluted	$	(0.14)	$	0.04

Weighted average shares used to compute earnings per share:
Basic	666.9		674.8
Diluted	666.9		679.3


	Ordinary Shares			Preferred Shares			Accumulated Other Comprehensive Loss	Accumulated Deficit		Total Shareholders’ Equity
(In millions)	Shares	Amount		Shares	Amount
Balance at December 31, 2023	666.1	$	11,740.5	14.4	$	1,392.6		$	(495.3)	$	(6,645.5)	$	5,992.3

Vesting of restricted stock units	3.3	—		—	—			—		—		—
Share-based award activity	(1.2)	6.9		—	—			—		—		6.9
Dividends to preferred shareholders	—	—		—	—			—		(18.8)		(18.8)
Net income (loss)	—	—		—	—			—		(75.0)		(75.0)
Other comprehensive income (loss)	—	—		—	—			(17.0)		—		(17.0)
Balance at March 31, 2024	668.2	$	11,747.4	14.4	$	1,392.6		$	(512.3)	$	(6,739.3)	$	5,888.4


	Three Months Ended March 31,
Revenues by transaction type	2024		2023
Subscription revenues	$	403.1	$	393.2
Re-occurring revenues	102.5		107.7
Transactional and other revenues	115.6		128.2

Revenues	$	621.2	$	629.1


Contract balances	March 31, 2024	December 31, 2023
Accounts receivable, net	822.9	908.3

Current portion of deferred revenues	1,010.1	983.1
Non-current portion of deferred revenues	17.7	38.7


	March 31, 2024						December 31, 2023
	Gross		Accumulated Amortization		Net		Gross		Accumulated Amortization		Net
Definite-lived intangible assets:
Customer relationships	$	7,800.9	$	(1,261.1)	$	6,539.8	$	7,819.9	$	(1,177.2)	$	6,642.7
Technology and content	2,808.2		(1,066.9)		1,741.3		2,798.3		(1,009.1)		1,789.2
Computer software	942.8		(540.6)		402.2		897.9		(516.4)		381.5
Trade names and other	88.7		(54.7)		34.0		88.9		(52.6)		36.3
Definite-lived intangible assets	$	11,640.6	$	(2,923.3)	$	8,717.3	$	11,605.0	$	(2,755.3)	$	8,849.7
Indefinite-lived intangible assets:
Trade names	156.9		—		156.9		156.9		—		156.9
Total intangible assets	$	11,797.5	$	(2,923.3)	$	8,874.2	$	11,761.9	$	(2,755.3)	$	9,006.6


	Balance Sheet Classification	March 31, 2024		December 31, 2023
Asset Derivatives
Derivatives designated as accounting hedges:
Interest rate swaps	Other current assets	$	—	$	4.1
Interest rate swaps	Other non-current assets	25.5		17.7
Cross-currency swaps	Other non-current assets	0.2		—
Derivatives not designated as accounting hedges:
Foreign currency forwards	Other current assets	0.1		1.3

Total Asset Derivatives		$	25.8	$	23.1

Liability Derivatives
Derivatives designated as accounting hedges:
Cross-currency swaps	Other non-current liabilities	$	—	$	2.0
Derivatives not designated as accounting hedges:
Foreign currency forwards	Accrued expenses and other current liabilities	0.6		0.1
Total Liability Derivatives		$	0.6	$	2.1


		March 31, 2024			December 31, 2023
Type	Maturity	Effective Interest Rate	Carrying Value		Effective Interest Rate	Carrying Value
Senior Notes	2029	4.875%	921.4		4.875%	921.4
Senior Secured Notes	2028	3.875%	921.2		3.875%	921.2
Senior Secured Notes	2026	4.500%	700.0		4.500%	700.0
Revolving Credit Facility	2029	8.077%	—		8.206%	—
Term Loan Facility	2031	8.077%	2,150.0		8.470%	2,197.4
Finance lease	2036	6.936%	30.0		6.936%	30.3
Total debt outstanding			$	4,722.6		$	4,770.3
Debt discounts and issuance costs			(62.0)			(48.0)
Current portion of long-term debt(1)			(22.7)			(1.2)
Long-term debt			$	4,637.9		$	4,721.1
(1) Included in Accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheets.


	Three Months Ended March 31, 2024
	Interest rate swaps		Defined benefit pension plans		Foreign currency translation adjustment		AOCL
Balance as of December 31, 2023	$	16.2	$	0.4	$	(511.9)	$	(495.3)
Other comprehensive income (loss) before reclassifications	11.5		—		(19.3)		(7.8)
Reclassifications from AOCL to net earnings	(8.9)		—		(0.3)		(9.2)
Net other comprehensive (loss) income	2.6		—		(19.6)		(17.0)
Balance as of March 31, 2024	$	18.8	$	0.4	$	(531.5)	$	(512.3)

	Three Months Ended March 31, 2023
	Interest rate swaps		Defined benefit pension plans		Foreign currency translation adjustment		AOCL
Balance as of December 31, 2022	$	38.1	$	1.5	$	(705.5)	$	(665.9)
Other comprehensive income (loss) before reclassifications	(3.5)		—		100.8		97.3
Reclassifications from AOCL to net earnings	(8.9)		—		—		(8.9)
Net other comprehensive income (loss)	(12.4)		—		100.8		88.4
Balance as of March 31, 2023	$	25.7	$	1.5	$	(604.7)	$	(577.5)

SEC Form 10-Q filed by Clarivate Plc