EGAN - eGain Reports Fiscal 2023 Third Quarter Financial Results
SUNNYVALE, Calif., May 11, 2023 (GLOBE NEWSWIRE) -- eGain (Nasdaq: EGAN), a leading knowledge platform for customer engagement, today announced financial results for its fiscal 2023 third quarter ended March 31, 2023.
“Our North America renewal and expansion rates remained strong during the quarter,” said Ashu Roy, eGain’s CEO. “Despite the market slowdown, we signed several new customers near the end of the quarter, and expense controls enabled us to deliver bottom-line results that exceeded our guidance and street consensus.”
Fiscal 2023 Third Quarter Financial Highlights
- Total revenue was $23.0 million, down 4% year over year (down 1% in constant currency).
- SaaS revenue was $20.9 million, up 1% year over year (up 3% in constant currency).
- GAAP net loss was $372,000, or $0.01 per share on a basic and diluted basis, compared to a GAAP net loss of $615,000, or $0.02 per share on a basic and diluted basis, in Q3 2022.
- Non-GAAP net income was $1.1 million, or $0.03 per share on a basic and diluted basis, compared to non-GAAP net income of $2.4 million, or $0.08 per share on a basic basis and $0.07 per share on a diluted basis, in Q3 2022.
- Cash provided by operations was $905,000, or an operating cash flow margin of 4%.
- Total cash and cash equivalents were $81.3 million, compared to $70.5 million in Q3 2022.
- Total shares purchased through repurchase program was approximately 145,000 at an average cost per share of $7.57, totaling $1.1 million.
Fiscal 2023 First Nine Months Financial Highlights
- Total revenue was $73.4 million, up 7% year over year (up 11% in constant currency).
- SaaS revenue was $66.9 million, up 11% year over year (up 14% in constant currency).
- GAAP net loss was $492,000, or $0.02 per share on a basic and diluted basis, compared to GAAP net loss of $890,000, or $0.03 per share on a basic and diluted basis in Q3 2022.
- Non-GAAP net income was $4.8 million, or $0.15 per share on a basic and diluted basis, compared to non-GAAP net income of $8.0 million, or $0.26 per share on a basic basis and $0.25 per share on a diluted basis in Q3 2022.
- Cash provided from operations was $9.1 million, or an operating cash flow margin of 12%.
Fiscal 2023 Fourth Quarter Financial Guidance
For the fourth quarter of fiscal 2023 ending June 30, 2023, eGain expects:
- Total revenue of between $23.4 million to $24.0 million.
- Non-GAAP total revenue, adjusted for constant currency, of between $23.4 million to $24.0 million.
- GAAP net income of $400,000 to $900,000, or $0.01 to $0.03 per share.
- Includes stock-based compensation expense of approximately $1.5 million.
- Includes depreciation and amortization of approximately $125,000.
- Non-GAAP net income of $1.9 million to $2.4 million, or $0.06 to $0.07 per share.
Fiscal 2023 Financial Guidance
For the fiscal 2023 full year ending June 30, 2023, eGain expects:
- Total revenue of between $96.8 million to $97.4 million.
- Non-GAAP total revenue, adjusted for constant currency, of between $99.2 million to $99.8 million.
- GAAP net loss of $300,000 to GAAP net income of $200,000, or $(0.01) to $0.01 per share.
- Includes stock-based compensation expense of approximately $6.8 million.
- Includes depreciation and amortization of approximately $600,000.
- Non-GAAP net income of $6.5 million to $7.0 million, or $0.20 to $0.21 per share.
Guidance Assumption:
- Weighted average shares outstanding are expected to be approximately 32.5 million for the fourth quarter of fiscal 2023 and 32.8 million for the full fiscal year 2023.
Non-GAAP Financial Measures
This press release includes certain non-GAAP financial measures as supplemental information relating to our operating results, including non-GAAP total revenue that is only adjusted for constant currency to provide better visibility into the underlying business trends and non-GAAP net income. The non-GAAP net income measure is adjusted for stock-based compensation expense. eGain’s management has analyzed the effect of these non-GAAP adjustments on our income tax provision and believes the change in our income tax provision would be minimal due to these non-GAAP adjustments being attributed to the U.S. jurisdiction where it has recorded full valuation allowance against the deferred taxes. Non-GAAP results are presented for supplemental informational purposes only and should not be considered a substitute for financial information presented in accordance with generally accepted accounting principles, or GAAP, and may be different from non-GAAP measures used by other companies. eGain’s management uses these non-GAAP measures to compare our performance to that of prior periods for trend analysis and for budgeting and planning purposes. eGain believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with other software companies, many of which present similar non-GAAP financial measures to investors, and that it allows for greater transparency with respect to key metrics used by management in our financial and operational decision-making. Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP financial measures used in this press release are included with the financial tables at the end of this release. eGain urges investors to review the reconciliation and not to rely on any single financial measure to evaluate our business. In addition, this presentation includes eGain’s projected non-GAAP total revenue, a non-GAAP measure used to describe eGain’s expected performance. We have not presented a reconciliation of this non-GAAP measure to eGain’s projected total revenue, the most comparable GAAP financial measure, because the reconciliation could not be prepared without unreasonable effort. The information necessary to prepare the reconciliation is not available on a forward-looking basis and cannot be accurately predicted. The unavailable information could have a significant impact on the calculation of the comparable GAAP financial measure.
Conference Call Information
eGain will discuss its fiscal 2023 third quarter results today via teleconference at 2:00 p.m. Pacific Time. To access the live call, dial 844 481-2704 (U.S. toll free) or +1 412-317-0660 (International) and ask to join the eGain earnings call. A live and archived webcast of the call will also be accessible on the “Investor relations” section of eGain’s website at www.egain.com. In addition, a phone replay of the conference call will be available starting two hours after the call and will remain in effect for one week. To access the phone replay, dial 877-344-7529 (U.S. toll free) or +1 412-317-0088 (International). The replay access code is 1400048.
About eGain
eGain Knowledge Hub automates and orchestrates customer engagement across touch points. Powered by AI and analytics, our secure cloud solution delivers personalized digital-first experiences, quick business value, and easy innovation. Visit www.egain.com for more info.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, including without limitation: our financial guidance for the fourth quarter of fiscal 2023 and fiscal 2023 full year ending June 30, 2023; and our market opportunity. The achievement or success of the matters covered by such forward-looking statements, including future financial guidance, involves risks, uncertainties, and assumptions, many of which involve factors or circumstances that are beyond our control. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our actual results could differ materially from the results expressed or implied by the forward-looking statements we make, including our ability to achieve our targets for the fourth quarter of fiscal 2023 and fiscal 2023 full year ending June 30, 2023. The risks and uncertainties referred to above include, but are not limited to: risks to our business, operating results, financial condition, and prospects from the COVID-19 pandemic and related economic downturns, including but not limited to, its effect on customer demand for our products and services and the impact of potential delays in customer payments; risks associated with new product releases and new services and products features; risks that customer demand may fluctuate or decrease; risks that we are unable to collect unbilled contractual commitments, particularly in the current economic environment; risks that our lengthy sales cycles may negatively affect our operating results; currency risks; our ability to capitalize on customer engagement; risks related to our reliance on a relatively small number of customers for a substantial portion of our revenue; our ability to compete successfully and manage growth; our ability to develop and expand strategic and third party distribution channels; risks related to our international operations; our ability to continue to innovate; our strategy of making investments in sales to drive growth; general political or destabilizing events, including war, intensified international hostilities, conflict or acts of terrorism; the effect of legislative initiatives or proposals, statutory changes, governmental or other applicable regulations and/or changes in industry requirements, including those addressing data privacy, cyber-security and cross-border data transfers; and other risks detailed from time to time in eGain’s public filings, including eGain’s annual report on Form 10-K for the fiscal year ended June 30, 2022 and subsequent reports filed with the Securities and Exchange Commission, which are available on the Securities and Exchange Commission’s website at www.sec.gov. These forward-looking statements are based on current expectations and speak only as of the date hereof. We assume no obligation and do not intend to update these forward-looking statements, except as required by law.
eGain, the eGain logo, and all other eGain product names and slogans are trademarks or registered trademarks of eGain Corporation in the United States and/or other countries. All other company names and products mentioned in this release may be trademarks or registered trademarks of the respective companies.
MKR Investor Relations
Todd Kehrli or Jim Byers
Phone: 323-468-2300
Email: egan@mkr-group.com
| eGain Corporation Condensed Consolidated Balance Sheets (in thousands, except par value data) (unaudited) |
| March 31, |
| June 30, |
| 2023 |
| 2022 |
| ASSETS |
| Current assets: |
| Cash and cash equivalents |
| $ |
| 81,306 |
| $ |
| 72,173 |
| Restricted cash |
| 7 |
| 7 |
| Accounts receivable, less allowance for doubtful accounts of $169 and $123 as of March 31, 2023 and June 30, 2022, respectively |
| 10,214 |
| 26,961 |
| Costs capitalized to obtain revenue contracts, net |
| 1,359 |
| 1,487 |
| Prepaid expenses |
| 2,614 |
| 2,612 |
| Other current assets |
| 1,083 |
| 895 |
| Total current assets |
| 96,583 |
| 104,135 |
| Property and equipment, net |
| 676 |
| 831 |
| Operating lease right-of-use assets |
| 3,086 |
| 3,850 |
| Costs capitalized to obtain revenue contracts, net of current portion |
| 2,561 |
| 3,136 |
| Goodwill |
| 13,186 |
| 13,186 |
| Other assets, net |
| 1,157 |
| 871 |
| Total assets |
| $ |
| 117,249 |
| $ |
| 126,009 |
| LIABILITIES AND STOCKHOLDERS' EQUITY |
| Current liabilities: |
| Accounts payable |
| $ |
| 1,495 |
| $ |
| 1,706 |
| Accrued compensation |
| 7,387 |
| 8,708 |
| Accrued liabilities |
| 5,505 |
| 4,926 |
| Operating lease liabilities |
| 967 |
| 1,044 |
| Deferred revenue |
| 35,106 |
| 45,638 |
| Total current liabilities |
| 50,460 |
| 62,022 |
| Deferred revenue, net of current portion |
| 2,225 |
| 3,785 |
| Operating lease liabilities, net of current portion |
| 1,906 |
| 2,537 |
| Other long-term liabilities |
| 818 |
| 808 |
| Total liabilities |
| 55,409 |
| 69,152 |
| Stockholders' equity: |
| Common stock, par value $0.001 - authorized: 60,000 shares; outstanding: 32,022 and 31,930 shares as of March 31, 2023 and June 30, 2022, respectively. |
| 32 |
| 32 |
| Additional paid-in capital |
| 399,548 |
| 393,157 |
| Treasury stock, at cost: 145 and 0 common shares as of March 31, 2023 and June 30, 2022, respectively. |
| (1,101 |
| ) |
| — |
| Notes receivable from stockholders |
| (96 |
| ) |
| (95 |
| ) |
| Accumulated other comprehensive loss |
| (2,501 |
| ) |
| (2,687 |
| ) |
| Accumulated deficit |
| (334,042 |
| ) |
| (333,550 |
| ) |
| Total stockholders' equity |
| 61,840 |
| 56,857 |
| Total liabilities and stockholders' equity |
| $ |
| 117,249 |
| $ |
| 126,009 |
| eGain Corporation Condensed Consolidated Statements of Operations (in thousands, except per share data) (unaudited) |
| Three Months Ended |
| Nine Months Ended |
| March 31, |
| March 31, |
| 2023 |
| 2022 |
| 2023 |
| 2022 |
| Revenue: |
| Subscription |
| $ |
| 20,980 |
| $ |
| 21,728 |
| $ |
| 67,517 |
| $ |
| 63,179 |
| Professional services |
| 2,033 |
| 2,176 |
| 5,859 |
| 5,268 |
| Total revenue |
| 23,013 |
| 23,904 |
| 73,376 |
| 68,447 |
| Cost of revenue: |
| Cost of subscription |
| 5,393 |
| 3,803 |
| 13,795 |
| 10,811 |
| Cost of professional services |
| 2,202 |
| 2,734 |
| 6,834 |
| 7,125 |
| Total cost of revenue |
| 7,595 |
| 6,537 |
| 20,629 |
| 17,936 |
| Gross profit |
| 15,418 |
| 17,367 |
| 52,747 |
| 50,511 |
| Operating expenses: |
| Research and development |
| 6,687 |
| 6,193 |
| 20,749 |
| 17,988 |
| Sales and marketing |
| 6,837 |
| 8,693 |
| 25,191 |
| 24,252 |
| General and administrative |
| 2,406 |
| 2,957 |
| 7,776 |
| 8,687 |
| Total operating expenses |
| 15,930 |
| 17,843 |
| 53,716 |
| 50,927 |
| Loss from operations |
| (512 |
| ) |
| (476 |
| ) |
| (969 |
| ) |
| (416 |
| ) |
| Interest income |
| 818 |
| 3 |
| 1,633 |
| 7 |
| Other (expense) income, net |
| (245 |
| ) |
| 200 |
| 20 |
| 182 |
| Income (Loss) before income tax provision |
| 61 |
| (273 |
| ) |
| 684 |
| (227 |
| ) |
| Provision for income taxes |
| (433 |
| ) |
| (342 |
| ) |
| (1,176 |
| ) |
| (663 |
| ) |
| Net loss |
| $ |
| (372 |
| ) |
| $ |
| (615 |
| ) |
| $ |
| (492 |
| ) |
| $ |
| (890 |
| ) |
| Per share information: |
| Loss per share: |
| Basic |
| $ |
| (0.01 |
| ) |
| $ |
| (0.02 |
| ) |
| $ |
| (0.02 |
| ) |
| $ |
| (0.03 |
| ) |
| Diluted |
| $ |
| (0.01 |
| ) |
| $ |
| (0.02 |
| ) |
| $ |
| (0.02 |
| ) |
| $ |
| (0.03 |
| ) |
| Weighted-average shares used in computation: |
| Basic |
| 32,122 |
| 31,647 |
| 32,024 |
| 31,451 |
| Diluted |
| 32,122 |
| 31,647 |
| 32,024 |
| 31,451 |
| Summary of stock-based compensation included in costs and expenses above: |
| Cost of revenue |
| $ |
| 371 |
| $ |
| 825 |
| $ |
| 1,213 |
| $ |
| 2,349 |
| Research and development |
| 509 |
| 783 |
| 1,633 |
| 2,310 |
| Sales and marketing |
| 174 |
| 580 |
| 997 |
| 1,840 |
| General and administrative |
| 393 |
| 820 |
| 1,440 |
| 2,437 |
| Total stock-based compensation |
| $ |
| 1,447 |
| $ |
| 3,008 |
| $ |
| 5,283 |
| $ |
| 8,936 |
| eGain Corporation GAAP to Non-GAAP Reconciliation Table (in thousands, except per share data) (unaudited) |
| Three Months Ended March 31, |
| Nine Months Ended March 31, |
| 2023 |
| 2022 |
| 2023 |
| 2022 |
| Loss from operations |
| $ |
| (512 |
| ) |
| $ |
| (476 |
| ) |
| $ |
| (969 |
| ) |
| $ |
| (416 |
| ) |
| Add: |
| Stock-based compensation |
| 1,447 |
| 3,008 |
| 5,283 |
| 8,936 |
| Non-GAAP income from operations |
| $ |
| 935 |
| $ |
| 2,532 |
| $ |
| 4,314 |
| $ |
| 8,520 |
| Net loss |
| $ |
| (372 |
| ) |
| $ |
| (615 |
| ) |
| $ |
| (492 |
| ) |
| $ |
| (890 |
| ) |
| Add: |
| Stock-based compensation |
| 1,447 |
| 3,008 |
| 5,283 |
| 8,936 |
| Non-GAAP net income |
| $ |
| 1,075 |
| $ |
| 2,393 |
| $ |
| 4,791 |
| $ |
| 8,046 |
| Per share information: |
| Non-GAAP earnings per share: |
| Basic |
| $ |
| 0.03 |
| $ |
| 0.08 |
| $ |
| 0.15 |
| $ |
| 0.26 |
| Diluted |
| $ |
| 0.03 |
| $ |
| 0.07 |
| $ |
| 0.15 |
| $ |
| 0.25 |
| Weighted-average shares used in computation: |
| Basic |
| 32,122 |
| 31,647 |
| 32,024 |
| 31,451 |
| Diluted |
| 32,968 |
| 32,932 |
| 32,909 |
| 32,827 |
| eGain Corporation Other GAAP to Non-GAAP Supplemental Financial Information (in thousands) (unaudited) |
| Three Months Ended March 31, |
| Growth Rates |
| Constant Currency Growth Rates [1] |
| 2023 |
| 2022 |
| Revenue: |
| SaaS revenue |
| $ |
| 20,854 |
| $ |
| 20,686 |
| 1 |
| % |
| 3 |
| % |
| Legacy revenue |
| 126 |
| 1,042 |
| (88 |
| %) |
| (87 |
| %) |
| GAAP subscription |
| 20,980 |
| 21,728 |
| (3 |
| %) |
| (1 |
| %) |
| GAAP professional services |
| 2,033 |
| 2,176 |
| (7 |
| %) |
| (5 |
| %) |
| Total GAAP revenue |
| $ |
| 23,013 |
| $ |
| 23,904 |
| (4 |
| %) |
| (1 |
| %) |
| SaaS and professional services revenue: |
| SaaS revenue |
| $ |
| 20,854 |
| $ |
| 20,686 |
| 1 |
| % |
| 3 |
| % |
| Professional Services |
| 2,033 |
| 2,176 |
| (7 |
| %) |
| (5 |
| %) |
| Total SaaS and professional services revenue |
| $ |
| 22,887 |
| $ |
| 22,862 |
| 0 |
| % |
| 2 |
| % |
| Cost of Revenue: |
| GAAP subscription |
| $ |
| 5,393 |
| $ |
| 3,803 |
| Non-GAAP subscription |
| $ |
| 5,393 |
| $ |
| 3,803 |
| GAAP professional services |
| $ |
| 2,202 |
| $ |
| 2,734 |
| Add back: |
| Stock-based compensation |
| (371 |
| ) |
| (825 |
| ) |
| Non-GAAP professional services |
| $ |
| 1,831 |
| $ |
| 1,909 |
| GAAP total cost of revenue |
| $ |
| 7,595 |
| $ |
| 6,537 |
| Add back: |
| Stock-based compensation |
| (371 |
| ) |
| (825 |
| ) |
| Non-GAAP total cost of revenue |
| $ |
| 7,224 |
| $ |
| 5,712 |
| 26 |
| % |
| 29 |
| % |
| Gross Profit: |
| Non-GAAP subscription |
| $ |
| 15,587 |
| $ |
| 17,925 |
| Non-GAAP professional services |
| 202 |
| 267 |
| Non-GAAP gross profit |
| $ |
| 15,789 |
| $ |
| 18,192 |
| (13 |
| %) |
| (11 |
| %) |
| Operating expenses: |
| GAAP research and development |
| $ |
| 6,687 |
| $ |
| 6,193 |
| Add back: |
| Stock-based compensation expense |
| (509 |
| ) |
| (783 |
| ) |
| Non-GAAP research and development |
| $ |
| 6,178 |
| $ |
| 5,410 |
| 14 |
| % |
| 17 |
| % |
| GAAP sales and marketing |
| $ |
| 6,837 |
| $ |
| 8,693 |
| Add back: |
| Stock-based compensation expense |
| (174 |
| ) |
| (580 |
| ) |
| Non-GAAP sales and marketing |
| $ |
| 6,663 |
| $ |
| 8,113 |
| (18 |
| %) |
| (15 |
| %) |
| GAAP general and administrative |
| $ |
| 2,406 |
| $ |
| 2,957 |
| Add back: |
| Stock-based compensation expense |
| (393 |
| ) |
| (820 |
| ) |
| Non-GAAP general and administrative |
| $ |
| 2,013 |
| $ |
| 2,137 |
| (6 |
| %) |
| (3 |
| %) |
| GAAP operating expenses |
| $ |
| 15,930 |
| $ |
| 17,843 |
| Add back: |
| Stock-based compensation expense |
| (1,076 |
| ) |
| (2,183 |
| ) |
| Non-GAAP operating expenses |
| $ |
| 14,854 |
| $ |
| 15,660 |
| (5 |
| %) |
| (2 |
| %) |
[1] Constant currency growth rates presented are derived from converting the current period results for entities reporting in currencies other than U.S. Dollars into U.S. Dollars at the exchange rates in effect during the prior period presented rather than the actual exchange rates in effect during the current period.
| eGain Corporation Other GAAP to Non-GAAP Supplemental Financial Information (in thousands) (unaudited) |
| Nine Months Ended March 31, |
| Growth Rates |
| Constant Currency Growth Rates [1] |
| 2023 |
| 2022 |
| Revenue: |
| SaaS revenue |
| $ |
| 66,911 |
| $ |
| 60,331 |
| 11 |
| % |
| 14 |
| % |
| Legacy revenue |
| 606 |
| 2,848 |
| (79 |
| %) |
| (74 |
| %) |
| GAAP subscription |
| 67,517 |
| 63,179 |
| 7 |
| % |
| 10 |
| % |
| GAAP professional services |
| 5,859 |
| 5,268 |
| 11 |
| % |
| 15 |
| % |
| Total GAAP revenue |
| $ |
| 73,376 |
| $ |
| 68,447 |
| 7 |
| % |
| 11 |
| % |
| SaaS and professional services revenue: |
| SaaS revenue |
| $ |
| 66,911 |
| $ |
| 60,331 |
| 11 |
| % |
| 14 |
| % |
| Professional Services |
| 5,859 |
| 5,268 |
| 11 |
| % |
| 15 |
| % |
| Total SaaS and professional services revenue |
| $ |
| 72,770 |
| $ |
| 65,599 |
| 11 |
| % |
| 14 |
| % |
| Cost of Revenue: |
| GAAP subscription |
| $ |
| 13,795 |
| $ |
| 10,811 |
| Non-GAAP subscription |
| $ |
| 13,795 |
| $ |
| 10,811 |
| GAAP professional services |
| $ |
| 6,834 |
| $ |
| 7,125 |
| Add back: |
| Stock-based compensation |
| (1,213 |
| ) |
| (2,349 |
| ) |
| Non-GAAP professional services |
| $ |
| 5,621 |
| $ |
| 4,776 |
| GAAP total cost of revenue |
| $ |
| 20,629 |
| $ |
| 17,936 |
| Add back: |
| Stock-based compensation |
| (1,213 |
| ) |
| (2,349 |
| ) |
| Non-GAAP total cost of revenue |
| $ |
| 19,416 |
| $ |
| 15,587 |
| 25 |
| % |
| 28 |
| % |
| Gross Profit: |
| Non-GAAP subscription |
| $ |
| 53,722 |
| $ |
| 52,368 |
| Non-GAAP professional services |
| 238 |
| 492 |
| Non-GAAP gross profit |
| $ |
| 53,960 |
| $ |
| 52,860 |
| 2 |
| % |
| 6 |
| % |
| Operating expenses: |
| GAAP research and development |
| $ |
| 20,749 |
| $ |
| 17,988 |
| Add back: |
| Stock-based compensation expense |
| (1,633 |
| ) |
| (2,310 |
| ) |
| Non-GAAP research and development |
| $ |
| 19,116 |
| $ |
| 15,678 |
| 22 |
| % |
| 25 |
| % |
| GAAP sales and marketing |
| $ |
| 25,191 |
| $ |
| 24,252 |
| Add back: |
| Stock-based compensation expense |
| (997 |
| ) |
| (1,840 |
| ) |
| Non-GAAP sales and marketing |
| $ |
| 24,194 |
| $ |
| 22,412 |
| 8 |
| % |
| 11 |
| % |
| GAAP general and administrative |
| $ |
| 7,776 |
| $ |
| 8,687 |
| Add back: |
| Stock-based compensation expense |
| (1,440 |
| ) |
| (2,437 |
| ) |
| Non-GAAP general and administrative |
| $ |
| 6,336 |
| $ |
| 6,250 |
| 1 |
| % |
| 4 |
| % |
| GAAP operating expenses |
| $ |
| 53,716 |
| $ |
| 50,927 |
| Add back: |
| Stock-based compensation expense |
| (4,070 |
| ) |
| (6,587 |
| ) |
| Non-GAAP operating expenses |
| $ |
| 49,646 |
| $ |
| 44,340 |
| 12 |
| % |
| 15 |
| % |
[1] Constant currency growth rates presented are derived from converting the current period results for entities reporting in currencies other than U.S. Dollars into U.S. Dollars at the exchange rates in effect during the prior period presented rather than the actual exchange rates in effect during the current period.