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Blackbaud Acquires Activity App Kilter

Technology firm Blackbaud has acquired Kilter in Madison, Wisc., a gamified, activity-based engagement app. The acquisition will allow Blackbaud to expand activity-based peer-to-peer fundraising engagement, support activity-based health and wellness initiatives for users, and to add to ways individuals can connect with the causes via Blackbaud platforms.

Terms of the deal were not disclosed. A spokesperson for Charleston, S.C.-based Blackbaud responded via email that “we have not disclosed the cost, but it’s a small acquisition with less than 10 employees. The acquisition will enable Blackbaud customers to engage their audiences through the activities they love, whether it’s a nonprofit looking to raise money for a cause, or a company looking to support health and wellness initiatives for employees.”

The Kilter app expands activity-based engagement beyond the familiar options of running, walking and cycling, by enabling users to track new, popular and personally relevant activities, from pickleball to meditation to motorcycling and more.

Kilter’s activity tracking app will be available as a feature to Blackbaud TeamRaiser customers with no additional subscription fees and will be available ahead of spring 2023 events, according to information released by Blackbaud. The plan is to extend Kilter’s capabilities to YourCause CSRconnect customers of Blackbaud, with integration to YourCause CSRconnect later in 2023. The app will be introduced to some customers in late 2022.

Blackbaud will leverage Kilter to support both activity-based fundraising for Blackbaud TeamRaiser® and activity-based health and wellness activities for Blackbaud’s YourCause® CSRconnect® platform, a solution for employee engagement leveraged by companies in support of their social responsibility goals.

“Activity tracking, like logging workouts, sharing goals, and exchanging virtual encouragement with friends, is quickly becoming part of daily routine for millions of people around the world and an essential part of peer-to-peer fundraising,” said Mike Gianoni, president and CEO, Blackbaud. “Our acquisition of Kilter will allow us to serve nonprofits by expanding the ways they can engage with their supporters to prepare for their existing fundraising walks, runs and rides, and to create totally new types of engagement opportunities that aren’t tied to a specific date or place. It will also provide a unique solution for companies as employers take a more active role in supporting their employees’ health and wellness pursuits across remote and distributed workforces.”

Financial results for Blackbaud’s second quarter and through the first half of 2022 were released recently which company officials described as ahead of plan. Second quarter 2022 results compared to second quarter 2021 include:

* Generally accepted accounting principles (GAAP) total revenue was $264.9 million, up 15.5%, with $252.5 million in GAAP recurring revenue, up 16.4%.

* Non-GAAP organic recurring revenue increased 5.1%.

* GAAP income from operations was $0.1 million, inclusive of security incident-related costs, net of insurance of $8.3 million, with GAAP operating margin of 0.0%, a decrease of 570 basis points.

* Non-GAAP income from operations was $54.5 million, with non-GAAP operating margin of 20.6%, a decrease of 300 basis points.

* GAAP net loss was $3.4 million, with GAAP diluted loss per share of $0.07, down $0.21 per share.

* Non-GAAP net income was $38.9 million, with non-GAAP diluted earnings per share of $0.75, down $0.07 per share.

* Non-GAAP adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) was $70.6 million, up $4.8 million, with non-GAAP adjusted EBITDA margin of 26.6%, an increase of 80 basis points.

* GAAP net cash provided by operating activities was $57.3 million, a decrease of $12.5 million. 

Company officials also revised Blackbaud’s 2022 full year financial guidance for non-GAAP revenue of $1.05 billion to $1.07 billion, non-GAAP adjusted EBITDA margin of 23.7% to 24.2%, Non-GAAP earnings per share of $2.43 to $2.63, and, Non-GAAP adjusted free cash flow of $140 million to $150 million.

Blackbaud stock is traded on NASDAQ under the sticker symbol BLKB. Its stock price as of this writing is $55.83 per share. Its 52-week high was $86.96 on Nov. 8, 2021 and 52-week was low was $48.52 on May 11, 2022. The share price year to date is down 29.3%. The firm’s margin was reported as 51.98%, with a net margin of negative 1.47%. The debt to equity ratio is 130.44%.

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