to the Company's day-to-day business operations. The nature of these 
      expenses is primarily related to a strategic review of the Company's 
      operations. 
   -- Contract termination impacts. Management excludes certain expenses that 
      are extraordinary in nature and are unrelated to the Company's day-to-day 
      business operations. The nature of these expenses is primarily related to 
      the impact of an adjustment related to the cancellation of an inbound 
      information contract. On September 23, 2024, the Company was informed by 
      one of its information vendors that it was exercising the right to 
      terminate the agreement with the Company effective September 25, 2024, 
      based on restrictions imposed by the information vendor's upstream 
      licensor. As a result, the Company recorded an adjustment of $542,389 
      during the quarter ended September 30, 2024, representing previously 
      recorded charges under the contract that will not be paid. 
   -- Income tax (benefit) expense. Management excludes the income tax 
      (benefit) expense from Adjusted EBITDA (i) because management believes 
      that the income tax (benefit) expense is not directly attributable to the 
      underlying performance of business operations and, accordingly, its 
      exclusion assists management and investors in making period-to-period 
      comparisons of operating performance and (ii) to assist management and 
      investors in making comparisons to companies with different tax 
      attributes. 

There are limitations to using non-GAAP financial measures because non-GAAP financial measures are not prepared in accordance with U.S. GAAP and may be different from non-GAAP financial measures provided by other companies.

The non-GAAP financial measures are limited in value because they exclude certain items that may have a material impact upon our reported financial results. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which items are adjusted to calculate our non-GAAP financial measures. We compensate for these limitations by analyzing current and future results on a U.S. GAAP basis as well as a non-GAAP basis and also by providing U.S. GAAP measures in our public disclosures.

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with U.S. GAAP. We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure to evaluate our business and to view our non-GAAP financial measures in conjunction with the most directly comparable U.S. GAAP financial measures.

The following table reconciles the specific items excluded from U.S. GAAP metrics in the calculation of non-GAAP metrics for the periods shown below:

 
              FORIAN INC. 
 RECONCILIATION OF US GAAP TO NON-GAAP 
           FINANCIAL MEASURES 
              (UNAUDITED) 
 
                 For the Three Months      For the Nine Months Ended 
                  Ended September 30,            September 30, 
               -------------------------  ---------------------------- 
                  2024          2023          2024          2023 
                ---------    ----------    ----------    ---------- 
 
Revenue        $4,686,312   $ 5,348,469   $14,340,791   $15,112,398 
 
Net (loss) 
 income from 
 continuing 
 operations    $ (204,907)  $ 5,453,643   $(3,970,781)  $ 2,114,444 
 
Depreciation 
 and 
 amortization       6,629        10,598        23,405        64,285 
Stock based 
 compensation 
 expense        1,552,042     1,551,997     4,873,593     4,920,572 
Change in 
 fair value 
 of warrant 
 liability            (20)       (1,594)         (563)       (4,088) 
Interest and 
 investment 
 income          (658,339)     (646,832)   (1,951,812)   (1,666,786) 
Interest 
 expense          195,415       211,333       587,684       630,547 
Gain on sale 
 of 
 investment       (32,082)   (5,805,858)      (80,694)   (5,805,858) 
Gain on debt 
 redemption             -      (111,151)     (137,356)     (111,151) 
Severance 
 expense                -             -             -       250,000 
Litigation 
 settlement 
 and related 
 expenses           1,394       316,820     1,152,670       751,480 
Strategic 
 review 
 related 
 expenses         (35,931)            -       399,913             - 
Impact of 
 contract 
 termination     (542,389)            -      (542,389)            - 
Income tax 
 expense          (95,896)       93,191        14,865       159,287 
 
Adjusted 
 EBITDA - 
 continuing 
 operations    $  185,916   $ 1,072,147   $   368,535   $ 1,302,732 
                =========    ==========    ==========    ========== 
 
 

(END) Dow Jones Newswires

November 13, 2024 16:00 ET (21:00 GMT)