Use
Non-GAAP Financial Measures
Alphatec provides its financial results in accordance with accounting principles generally accepted in the
United
States (GAAP). The Company also uses forward-looking non-GAAP financial measures
in addition to and in
conjunction with corresponding GAAP measures to help analyze the
performance of its core business, in
connection with the preparation of annual budgets, and in
measuring performance for some forms of
compensation. In particular, Alphatec presents (i)
adjusted EBITDA, and (ii) combined pro forma financial
information, which in each case are
non-GAAP financial measures.
Non-GAAP financial measures reflect an additional way of viewing aspects of Alphatecs operations
that, when
viewed with the GAAP results, provide a more complete understanding of
Alphatecs results of operations and
the factors and trends affecting Alphatecs
business. However, non-GAAP financial measures should be
considered as a supplement to, and
not as a substitute for, or superior to, the corresponding measures
calculated in accordance with
GAAP. Non-GAAP financial measures used by the Company may differ from the
non-GAAP
financial measures used by other companies, including Alphatecs competitors.
Alphatec believes the most directly comparable GAAP financial measure to adjusted EBITDA is net income
(loss). Adjusted EBITDA is net income (loss) excluding the effects of interest, taxes, depreciation,
amortization,
stock-based compensation costs, and other non-recurring income of expense
items, such as in-process
research and development, expenses related to the transaction and
acquisition related restructuring expenses
that are expected to occur following closing.
Alphatec has not included in this presentation a reconciliation of these forward-looking non-GAAP
financial
measures to the most directly comparable GAAP financial measures because, due to
variability and difficulty in
making accurate forecasts and projections or certain information
not being ascertainable or accessible, not all
of the information necessary for a quantitative
reconciliation of the forward-looking non-GAAP financial
measures to the most directly
comparable GAAP financial measures is available to the Company without
unreasonable
efforts. The probable significance of providing these forward-looking non-GAAP financial
measures without the directly comparable GAAP financial measures is that such GAAP financial measures may
be materially different from the corresponding non-GAAP financial measures.
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