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

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Nov 07, 2018, 16:15 ET

CHICAGO, Nov. 7, 2018 /PRNewswire/ -- Cision Ltd. (NYSE: CISN), a leading global provider of software and services to public relations and marketing communications professionals, today reported financial results for the quarter ended September 30, 2018.

All data presented below is compared to the third quarter of 2017, unless otherwise noted.

Third Quarter 2018 Financial Highlights

Revenue increased 11.0% to $177.2 million
Revenue, excluding the impact from purchase accounting, increased 10.7% to $177.5 million
Operating income increased 2.4% to $14.2 million
Net loss decreased 87.0% to $6.0 million
Adjusted EBITDA increased 9.9% to $62.7 million
Adjusted net income increased 47.0% to $26.6 million
Adjusted net income per share increased 33.3% to $0.20

"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

Americas revenues increased 8.8% to $122.6 million
EMEA revenues increased 15.6% to $46.6 million
APAC revenues increased 19.8% to $8.1 million
Non-core revenues declined 41.2% to $1.0 million
Average pro forma subscription customers increased 2.8% to approximately 41,700
Average annualized pro forma revenue per subscription customer, excluding the impact of currency, increased 1.2% to approximately $11,200
Customers that purchased services from us on a transaction basis decreased 6.6% to approximately 38,200
Average pro forma revenue per customer per quarter that purchased services from us on a transaction basis, excluding the impact of currency, increased 5.4% to approximately $1,400
Cross-sell bookings of software, distribution and insights in the United States increased 130.3% to $2.2 million
Cision Communication Cloud ® platform customers at September 30, 2018 were approximately 9,400

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.

	Q3 2017	Q4 2017	Q1 2018	Q2 2018	Q3 2018	Q3 2018 compared to Q3 2017

Average pro forma subscription customers	40,532	40,628	40,252	41,249	41,661	2.8%

Average annualized pro forma revenue per subscription customer	$11,101	$11,227	$11,153	$11,186	$11,237	1.2%

Pro forma transaction customers	40,829	41,670	40,216	41,172	38,152	(6.6%)

Average pro forma revenue per transaction customer	$1,286	$1,405	$1,382	$1,454	$1,356	5.4%

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.

	Previous	Updated
Revenue	$722 - $730	$724 - $728
Revenue, excluding the impact from purchase accounting	$724 - $732	$725 - $729
Net income	($6) - $6	($12.0) - ($8.0)
Adjusted EBITDA	$249 - $253	$250 - $253
Adjusted net income	$106 - $109	$106 - $109
Adjusted net income per diluted share	$0.83 - $0.85	$0.83 - $0.85
Pro-forma fully diluted weighted average shares outstanding	128.3	128.8

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

	Previous	Updated
Depreciation expense	$30 - $32	$30 - $32
Amortization expense	$105 - $107	$104 - $106
Amortization expense included in cost of revenue	$23 - $24	$23 - $24
Interest expense	$78 - $80	$77 - $79
Debt extinguishment costs	$4 - $5	$4 - $5
Interest expense, net of debt extinguishment costs	$74 - $76	$73 - $75
Cash interest expense	$64 - $66	$64 - $66
Stock-based compensation	$4 - $5	$4 - $5
Capital expenditures, inclusive of capitalized software development	$34 - $36	$33 - $35

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:

	Previous	Updated
GBP to USD	1.30	1.28
EUR to USD	1.16	1.14
CAD to USD	0.77	0.76

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.

Cision Ltd. and its Subsidiaries
Condensed Consolidated Balance Sheets
As of September 30, 2018 and December 31, 2017
(in thousands, except per share and share amounts)
(Unaudited)


			2018	2017
Assets
Current assets:
	Cash and cash equivalents		$ 84,192	$ 148,654
	Accounts receivable, net		113,821	113,008
	Prepaid expenses and other current assets		21,426	19,896
		Total current assets	219,439	281,558
Property and equipment, net			54,032	53,578
Other intangible assets, net			406,515	456,291
Goodwill			1,179,597	1,136,403
Other assets			6,429	7,528
		Total assets	$ 1,866,012	$ 1,935,358
Liabilities and Stockholders' Equity
Current liabilities:
	Current portion of long-term debt		$ 13,251	$ 13,349
	Accounts payable		12,560	13,327
	Accrued compensation and benefits		25,718	25,873
	Other accrued expenses		75,128	73,483
	Current portion of deferred revenue		140,493	140,351
		Total current liabilities	267,150	266,383
Long-term debt, net of current portion			1,206,313	1,266,121
Deferred revenue, net of current portion			1,258	1,412
Deferred tax liability			65,068	62,617
Other liabilities			20,778	22,456
		Total liabilities	1,560,567	1,618,989
Stockholders' equity:
	Preferred stock, $0.0001 par value, 20,000,000 shares authorized; no shares issued and outstanding at September 30, 2018 and December 31, 2017		-	-
	Common stock, $0.0001 par value, 480,000,000 shares authorized; 132,713,555 and 122,634,922 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively		13	12
	Additional paid-in capital		795,668	771,813
	Accumulated other comprehensive loss		(55,907)	(35,111)
	Accumulated deficit		(434,329)	(420,345)
		Total stockholders' equity	305,445	316,369
		Total liabilities and stockholders' equity	$ 1,866,012	$ 1,935,358

Cision Ltd. and its Subsidiaries
Condensed Consolidated Statements of Operations and Comprehensive Loss
(in thousands, except per share and share amounts)
(Unaudited)

			Three months ended September 30,		Nine months ended September 30,
			2018	2017	2018	2017
Revenue			$ 177,236	$ 159,729	$ 544,004	$ 462,678
Cost of revenue			69,177	53,287	200,212	147,571
		Gross profit	108,059	106,442	343,792	315,107

Operating costs and expenses:
	Sales and marketing		27,367	27,931	85,345	83,231
	Research and development		7,292	5,661	22,282	16,679
	General and administrative		39,002	36,127	126,762	117,819
	Amortization of intangible assets		20,167	22,829	60,681	66,306
		Total operating costs and expenses	93,828	92,548	295,070	284,035
		Operating income	14,231	13,894	48,722	31,072

Non operating income (expense):
	Foreign exchange gains (losses)		2,196	802	10,277	(1,832)
	Interest and other income, net		380	177	472	2,450
	Interest expense		(19,785)	(23,063)	(59,947)	(96,306)
	Loss on extinguishment of debt		-	(51,872)	(2,432)	(51,872)
		Total non operating loss	(17,209)	(73,956)	(51,630)	(147,560)
		Loss before income taxes	(2,978)	(60,062)	(2,908)	(116,488)
Provision for (benefit from) income taxes			3,070	(13,653)	10,016	(27,938)
		Net loss	(6,048)	(46,409)	(12,924)	(88,550)
Other comprehensive income (loss) - foreign currency translation adjustments			(2,479)	13,371	(20,796)	35,965
		Comprehensive loss	$ (8,527)	$ (33,038)	$ (33,720)	$ (52,585)

Net loss per share:
	Basic and Diluted		$ (0.05)	$ (0.38)	$ (0.10)	$ (1.47)
Weighted average shares outstanding used in computing per share amounts:

	Basic and Diluted		131,104,859	120,584,316	127,507,314	60,120,689

Cision Ltd. and its Subsidiaries
Condensed Consolidated Statements of Cash Flows
For the Nine Months Ended September 30, 2018 and September 30, 2017
(in thousands)
(Unaudited)


				2018	2017
Cash flows from operating activities
Net loss				$ (12,924)	$ (88,550)
Adjustments to reconcile net loss to net cash provided by operating activities:
	Depreciation and amortization			100,186	103,392
	Non-cash interest charges and amortization of debt discount and deferred financing costs			10,158	62,824
	Equity-based compensation expense			3,713	2,944
	Provision for doubtful accounts			3,972	2,247
	Deferred income taxes			3,437	(29,970)
	Unrealized currency translation losses (gains)			(10,338)	1,551
	Gain on sale of business			-	(1,785)
	Other			86	(171)
	Changes in operating assets and liabilities, net of effects of acquisitions and disposal:				-
		Accounts receivable		967	7,018
		Prepaid expenses and other current assets		(1,133)	1,072
		Other assets		(726)	113
		Accounts payable		(1,721)	(2,110)
		Accrued compensation and benefits		(321)	(10,207)
		Other accrued expenses		(7,320)	(4,123)
		Deferred revenue		1,767	(3,593)
		Other liabilities		(14)	(2,310)
			Net cash provided by operating activities	89,789	38,342

Cash flows from investing activities
Purchases of property and equipment				(10,325)	(7,746)
Software development costs				(12,026)	(11,365)
Acquisitions of businesses, net of cash received of $2,711 and $12,355				(66,463)	(54,992)
Proceeds from disposal of business				-	23,675
Change in restricted cash				5	607
			Net cash used in investing activities	(88,809)	(49,821)

Cash flows from financing activities
Proceeds from revolving credit facility				-	5,000
Repayment of revolving credit facility				-	(38,475)
Payment of amounts due to Cision Owner				-	(1,940)
Proceeds from term credit facility, net of debt discount of $10,091				-	1,275,634
Repayments of term credit facility				(59,989)	(1,494,501)
Payments on capital lease obligations				-	(171)
Payments of deferred financing costs				(294)	-
Proceeds from merger and recapitalization				-	305,210
Payment of contingent consideration				(2,873)	-
			Net cash provided by (used in) financing activities	(63,156)	50,757
Effect of exchange rate changes on cash and cash equivalents				(2,286)	2,319
			Increase (decrease) in cash and cash equivalents	(64,462)	41,597

Cash and cash equivalents
Beginning of period				148,654	35,135
End of the period				$ 84,192	$ 76,732

Supplemental non-cash information					-
Issuance of securities by Cision Owner in Connection with acquisitions				$ -	$ 7,000
Non-cash contribution from Cision Owner in connection with merger				-	451,139
Issuance of shares for acquisition				20,143	-

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.

Cision Ltd. and its Subsidiaries
Reconciliation of Net Loss to EBITDA and Adjusted EBITDA
(in millions)
(Unaudited)

	Three Months Ended September 30, 2018	Three Months Ended September 30, 2017	Change	Nine Months Ended September 30, 2018	Nine Months Ended September 30, 2017	Change
Net loss	$ (6.0)	$ (46.4)	$ 40.4	$ (12.9)	$ (88.6)	$ 75.6
Depreciation and amortization	33.3	36.1	(2.8)	100.2	103.4	(3.2)
Interest expense and loss on extinguishment of debt	19.8	74.9	(55.1)	62.4	148.2	(85.8)
Provision for (benefit from) income taxes	3.1	(13.7)	16.7	10.0	(27.9)	38.0
EBITDA (1)	50.1	51.0	(0.9)	159.6	135.1	24.5
Acquisition and offering related costs	12.8	5.2	7.6	32.6	25.5	7.1
Gain on sale of business	-	-	-	-	(1.8)	1.8
Stock-based compensation	1.5	1.0	0.5	3.7	2.9	0.8
Deferred revenue reduction from purchase accounting	0.3	0.6	(0.4)	1.5	0.8	0.7
Sponsor fees and expenses	-	-	-	-	0.3	(0.3)
Unrealized translation (gain) loss	(2.1)	(0.8)	(1.2)	(10.3)	1.6	(11.9)
Adjusted EBITDA (2)	$ 62.7	$ 57.0	$ 5.7	$ 187.1	$ 164.4	$ 22.8

Cision Ltd. and its Subsidiaries
Reconciliation of Net Loss to Adjusted Net Income and Adjusted Net Income per Diluted Share
(in millions, except for per share amounts)
(Unaudited)

	Three Months Ended September 30, 2018	Three Months Ended September 30, 2017	Change	Nine Months Ended September 30, 2018	Nine Months Ended September 30, 2017	Change
Net loss	$ (6.0)	$ (46.4)	$ 40.4	$ (12.9)	$ (88.6)	$ 75.6
Provision for (benefit from) income taxes	3.1	(13.7)	16.7	10.0	(27.9)	38.0
Acquisition and offering related costs	12.8	5.2	7.6	32.6	25.5	7.1
Gain on sale of business	-	-	-	-	(1.8)	1.8
Stock-based compensation expense	1.5	1.0	0.5	3.7	2.9	0.8
Deferred revenue reduction from purchase accounting	0.3	0.6	(0.4)	1.5	0.8	0.7
Amortization related to acquired intangible assets	26.0	29.2	(3.1)	78.1	84.5	(6.4)
Non-recurring interest and loss on extinguishment of debt	0.4	51.9	(51.5)	4.3	55.9	(51.6)
Sponsor fees and expenses	-	-	-	-	0.3	(0.3)
Unrealized translation (gain) loss	(2.1)	(0.8)	(1.2)	(10.3)	1.6	(11.9)
Adjusted Income before income taxes	36.0	27.0	9.0	106.9	53.2	53.8
Less: Income tax at a 26% rate for 2018, and a 33% rate for 2017	(9.4)	(8.9)	(0.4)	(27.8)	(17.5)	(10.3)
Adjusted net income (3)	$ 26.6	$ 18.1	$ 8.5	$ 79.1	$ 35.6	$ 43.5
Pro forma fully-diluted weighted average shares outstanding	131,105	120,584	10,521	127,507	95,335	32,172
Adjusted net income per diluted share (4)	$0.20	$0.15	$0.05	$0.62	$0.37	$0.24

Cision Ltd. and its Subsidiaries
Reconciliation of Net Cash Provided by Operating Activities to Adjusted Net Cash Provided by Operating Activities
(in millions)
(Unaudited)

	Three Months Ended September 30, 2018	Three Months Ended September 30, 2017	Change	Nine Months Ended September 30, 2018	Nine Months Ended September 30, 2017	Change
Net cash provided by operating activities	$ 26.2	$ 20.2	$ 5.9	$ 89.8	$ 38.3	$ 51.4
Acquisition and offering related costs	12.8	5.2	7.6	32.6	25.5	7.1
Adjusted net cash provided by operating activities (5)	$ 39.0	$ 25.5	$ 13.5	$ 122.4	$ 63.9	$ 58.5


(1)	Cision defines EBITDA as net income (loss), plus depreciation and amortization expense, plus interest expense and loss on extinguishment of debt, plus provision for (or minus benefit from) income taxes.

(2)	Cision defines Adjusted EBITDA as EBITDA, further adjusted for acquisition and offering related costs, stock-based compensation, deferred revenue reduction from purchase accounting, (gains) losses related to divested businesses or assets, sponsor fees and expenses, and unrealized translation losses (gains). All of the items included in the reconciliation from net income to Adjusted EBITDA are either non-cash items or are items that we consider to be less useful in assessing our operating performance. In the case of the non-cash items, we believe that investors can better assess our operating performance if the measures are presented without such items because, unlike cash expenses, these adjustments do not affect our ability to generate free cash flow or invest in our business. For example, by excluding depreciation and amortization from EBITDA, users can compare operating performance without regard to different accounting determinations such as useful life. In the case of the other items, we believe that investors can better assess operating performance if the measures are presented without these items because their financial impact does not reflect ongoing operating performance.

(3)	Cision defines Adjusted net income as net income (loss) plus provision for (or minus benefit from) income taxes, further adjusted for acquisition and offering related costs, (gains) losses related to divested businesses or assets, stock-based compensation, deferred revenue reduction from purchase accounting, amortization related to acquired intangibles, non-recurring interest and losses on extinguishment of debt, sponsor fees and expenses, and unrealized translation losses (gains), which together, sum to Adjusted net income (loss) before income taxes. Adjusted net income (loss) before income taxes is then taxed at an assumed long term corporate tax rate of 33% for 2017 and periods prior, and 26% for 2018 and beyond, pursuant to our preliminary analysis with respect to recent U.S. tax law changes, to determine Adjusted net income. The enactment of the Tax Cuts and Jobs Act in December 2017 resulted in a provisional net one-time tax of $11.9 million in the fourth quarter of 2017 based on a reasonable estimate of the income tax effects, primarily from a tax on accumulated foreign earnings, the remeasurement of deferred tax assets and liabilities and new limitations on the deductibility of interest. Our calculation of Adjusted net income excludes this provisional net one-time tax. We continue to finalize the analysis of the tax reform provisions in 2018. All of the items included in the reconciliation from net income to Adjusted net income are either non-cash items or are items that we consider to be less useful in assessing our operating performance. In the case of the non-cash items, we believe that investors can better assess our operating performance if the measures are presented without such items because, unlike cash expenses, these adjustments do not affect our ability to generate free cash flow or invest in our business. For example, by excluding the amortization related to acquired intangibles, users can compare operating performance without regard to highly variable amortization expenses related to our acquisitions. In the case of the other items, we believe that investors can better assess operating performance if the measures are presented without these items because their financial impact does not reflect ongoing operating performance.

(4)	Cision defines Adjusted net income per diluted share as Adjusted net income, as defined above, divided by the fully-diluted pro forma weighted average shares outstanding for the period. The fully-diluted pro forma weighted average shares outstanding for the respective period assume that the exchange of shares pursuant to our merger with Capitol Acquisition Corp. III had taken effect as of the beginning of such period. Additionally, for purposes of calculating the number of fully diluted shares outstanding, we have excluded the potential impact of dilution from outstanding warrants to purchase shares of our common stock prior to the dates of their conversion, and stock options and restricted units issued and outstanding pursuant to our 2017 Omnibus Incentive Plan. During the second quarter of fiscal 2018, we issued an aggregate of 6,342,989 ordinary shares (6,100,209 ordinary shares on May 18, 2018 and 242,780 ordinary shares on June 4, 2018), in exchange for all of our outstanding warrants, pursuant to the completion of our warrant exchange transactions. During the third quarter of 2018, we issued 2,000,000 ordinary shares for the earn-out achieved during the quarter. Commencing on these respective issuance dates, we included the issued shares in our fully-diluted pro forma weighted average share count. Using our average share price of $16.46 for the three months ended September 30, 2018, our fully-diluted pro forma weighted average shares outstanding for the three months ended September 30, 2018 would have been approximately 131.7 million had we incorporated the dilutive effects of the stock options and restricted units.

(5)	Cision defines Adjusted net cash provided by operating activities as net cash provided by operating activities adjusted for acquisition and offering related costs.