Archive for the ‘Earnings’ Category

DexOne, YPG Announce Q1 Results

May 6, 2010

Both publishers posted Q1 2010 results today. Revenues and earnings were down in both cases, although YPG fared better.

YPG:

For the quarter ending March 31, 2010, consolidated net earnings were $121.8 million compared with $132.1 million for the same period in 2009. Income from operations was $166.8 million versus $185.7 million last year. Cash flow from operating activities reached $143.5 million during the quarter as compared to $197.4 million in 2009.

Consolidated Adjusted Revenues and revenues, at $408.1 million, decreased by approximately 1% and $0.2 million respectively from last year. Consolidated Adjusted EBITDA was $219.8 million, down from $225.9 million twelve months ago. EBITDA (income from operations before depreciation and amortization, and acquisition-related costs) was $216.1 million compared to $223.9 million in 2009. EBITDA on a reported basis is net of non-recurring rebranding and conversion costs aggregating $3.7 million in the first quarter of 2010 . . .

Combined online revenues for Directories and Vertical Media reached $98.4 million for the quarter or $393.6 million on an annualized basis, representing online organic growth of 20%.

If I’m doing the math right, online revenues were 24% of overall.

DexOne (formerly RHD) “a leading provider of marketing solutions for local businesses”:

New accounting rules/procedures make the results apparently anomalous. But here are some excerpts from the release:

“First quarter ad sales declined 19 percent largely reflecting selling activity during the third and fourth quarters of 2009. Recent sales campaigns are generating sequential improvements in ad sales trends, which we expect to continue throughout the remainder of 2010 . . .”

Dex One is affirming full year 2010 guidance originally provided on March 4, 2010:

— Year over year decline in advertising sales of between 12 percent and 15 percent.

— Combined adjusted net revenue(1,2) of approximately $1.8 billion and net revenue of approximately $0.9 billion.

— Combined adjusted EBITDA(1,2,3) of approximately $750 million and operating loss of approximately $100 million.

— Combined adjusted free cash flow(1,2,3) of approximately $450 million and cash flow from operations of approximately $400 million.

Again: “Year over year decline in advertising sales of between 12 percent and 15 percent.”

To what extent is this a benchmark for the rest of the industry?

IAC Earnings Tidbits: CityGrid, ServiceMagic

April 28, 2010

Here are a couple of interesting tidbits from IAC’s earnings release:

CityGrid added more than 150 new publishers since launching its developer center on January 29th, and added Dex One as a major reseller partner, bringing the total number of reseller partners to 10. ServiceMagic grew domestic service providers 26% year-over-year, including the addition of service providers in new categories such as events and senior care.

IAC doesn’t break out Citysearch revenues sepearately. But ServiceMagic reported $42 million in Q1 2010 revenues vs. $31 million a year ago. That’s a $100 million-plus business now.

I met last week with CEO Jay Herratti who said that CityGrid was really on fire.

The FT on Debt and YP Publishers

February 15, 2010

Thanks to Simon Baptist for pointing me to a piece in the Financial Times, which discusses the debt predicaments of European yellow pages publishers and how that will affect their businesses. I’ll sidestep that vexing issue, which forced then RHD and Idearc into Chapter 11 (both are now out).

Here are some interesting bits from the article that caught my eye:

  • Truvo is forecasting a 29% drop in print revenues year on year in 2009, partially offset by a 12% increase in online sales.
  • Yell: “Around 20% of our overall revenues come from online advertising and in the UK it is 30%”
  • Pages Jaunes (France): around 45% of total revenues are derived from online advertisement sales

The Truvo decline is more aggressive than in the US but print YP publishers have suffered double-digit print declines during the recession. The question is where will that revenue go: to publishers in diversified product bundles or to third parties competing with them to offer online ads?

See my related post: SMB Market Getting ‘Noisier’ by the Day

Yell Reveals Better than Expected Earnings

February 5, 2010

Yesterday UK-based directory publisher Yell (which owns Yellowbook) announced somewhat better-than-expected quarterly earnings. Here are some of the highlights (click to enlarge the charts):

Yell:

Internet revenues continue to grow and represent almost 30% of total UK revenues compared to 24% last year.  Our intentional focus on acquiring more relevant searches for our advertisers, at the expense of volume, caused unique internet users to fall in December.

Yellowbook:

Internet revenues now represent over 16% of total US revenues up from 12% last year with future growth built on the foundation of continuing strong growth in unique visitors.

Tech Companies Among Inc’s 500/5000

August 13, 2009

Picture 3Inc Magazine has done its annual ranking of the fastest-growing small companies. There are many tech companies on the list but three that proactively reached out to me were G5 Search Marketing, ReachLocal and Angie’s List. I don’t have the time to comb through the entire list (which is not that user friendly) to pull out everyone interesting.

Here’s how companies make the list (and presumably the revenue numbers are real):

The Inc. 500|5000 is ranked according to percentage revenue growth from 2005 through 2008. To qualify, companies must have been founded and generating revenue by the first week of 2005, and therefore able to show four full calendar years of sales. Additionally, they have to be U.S.-based, privately held, for profit, and independent — not subsidiaries or divisions of other companies — as of December 31, 2008 (a number of companies on the list have gone public or been acquired since that date). Revenue in 2005 must have been at least $200,000, and revenue in 2008 must have been at least $2 million.

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RHD Posts Q2 Earnings

August 4, 2009

Picture 22YP publisher RH Donnelley this afternoon announced Q2 earnings:

R.H. Donnelley Corporation . . . reported second quarter 2009 net revenue of $566 million, representing a 15 percent decline from second quarter 2008. Adjusted EBITDA(1) in the quarter was $293 million, down 20 percent from second quarter 2008. Adjusted free cash flow in the quarter was $164 million – based on cash flow from operations of $121 million, capital expenditures of $6 million and $49 million related to reorganizational, restructuring and restricted stock unit payments – up from $159 million in second quarter 2008, primarily due to the termination of bond interest payments while in bankruptcy. Second quarter advertising sales were $523 million, down 23 percent from advertising sales in the second quarter 2008. Net loss was $75 million in the quarter compared to a net loss of $339 million in second quarter 2008.

“Second quarter advertising sales were $523 million, down 23 percent from advertising sales in the second quarter 2008.”

Here are the filings for those who want to dig deeper.

Good News, Bad News in WashPo Q2

August 2, 2009

Picture 2Here’s the earnings release from Friday. Revenues were down but the quarter saw a profit for the company overall; newspapers were down:

The Washington Post Company today reported net income of $11.4 million ($1.30 earnings per share) for its second quarter ended June 28, 2009, compared to a net loss of $2.7 million ($0.31 loss per share) for the second quarter of last year . . .

Revenue for the first half of 2009 was $2,182.6 million, up 1% from $2,169.4 million in the first half of 2008, due to increased revenues at the Company’s education and cable television divisions, offset by revenue declines at the Company’s newspaper publishing, magazine publishing and television broadcasting divisions. The Company reported an operating loss of $13.4 million for the first half of 2009, compared to operating income of $71.7 million for the first half of 2008 . . .

Newspaper publishing division revenue totaled $168.8 million for the second quarter of 2009, a decrease of 14% from $197.3 million in the second quarter of 2008; division revenue decreased 18% to $329.7 million for the first six months of 2009, from $403.4 million for the first six months of 2008. Print advertising revenue at The Post in the second quarter of 2009 declined 20% to $80.0 million, from $99.8 million in the second quarter of 2008, and decreased 27% to $154.3 million for the first six months of 2009, from $211.4 million in the same period of 2008. The print revenue decline in the second quarter of 2009 is due to large decreases in classified, zones and general advertising; the decline in the first half of 2009 includes similar declines. Revenue generated by the Company’s newspaper online publishing activities, primarily washingtonpost.com, declined 9% to $23.5 million for the second quarter of 2009, versus $25.9 million for the second quarter of 2008; newspaper online revenues declined 9% to $45.6 million in the first six months of 2009, versus $49.8 million for the first six months of 2008. Display online advertising revenue grew 2% for the second quarter and first six months of 2009. Online classified advertising revenue on washingtonpost.com declined 29% and 26% for the second quarter and first six months of 2009, respectively.

For the first six months of 2009, Post daily and Sunday circulation declined 1.5% and 2.6%, respectively, compared to the same periods of the prior year. For the six months ended June 28, 2009, average daily circulation at The Post totaled 622,700 and average Sunday circulation totaled 858,100.

Newsweek also saw significant revenue declines:

Revenue for the magazine publishing division totaled $45.5 million in the second quarter of 2009, a 27% decrease from $62.7 million in the second quarter of 2008; division revenue totaled $91.6 million for the first six months of 2009, a 21% decrease from $116.1 million in the first six months of 2008. The decline is due to a 40% and 32% reduction in advertising revenue at Newsweek for the second quarter and first six months of 2009, respectively, resulting from fewer ad pages at both the domestic and international editions. In February 2009, Newsweek announced a circulation rate base reduction at its domestic edition, from 2.6 million to 1.5 million, by January 2010.

Local.com Q2 Results Excerpts

July 31, 2009

Picture 43Local.com Q2 results came out yesterday: “the company expects revenue to be between $13.4 and $13.7 million, exceeding the high end of its prior guidance of $13.2 million.”

Here’s are more non-financial details that went out with the release (verbatim):

  • Record Traffic – The company reached record traffic of 63 million monthly unique visitors (MUVs) on the Local.com site and network during the second quarter of 2009, up 5% from 60 million MUVs during the first quarter of 2009, and up 31% from 48 million MUVs during the second quarter of 2008.
  • Organic Traffic – Organic traffic also reached an all-time high, exceeding 29 million monthly unique visitors on the Local.com site and network during the second quarter of 2009, up 7% from 27 million during the first quarter of 2009, and up 61% from 18 million during the second quarter of 2008.
  • Advertisers – We ended the second quarter of 2009 with over 27,000 subscription customers compared to nearly 30,000 at the end of the first quarter of 2009 and 5,000 at the end of 2008.
  • Private Label Partnerships– In June 2009, the company announced partnerships with The Dallas Morning News and The Press Enterprise to power local search on the companies’ web properties. The company currently partners with over 700 regional media sites.
  • Technology Licensees – The number of licensees for the company’s local search technologies grew to 63 during the second quarter of 2009, up from 48 in the first quarter of 2009.

Range of Local/YP Financial Results

May 7, 2009

A bunch of Q1 results in the local segment came out yesterday or this a.m.:

YPG is holding its own, while RHD saw a tough quarter reflecting both “cyclical and secular” trends affecting directories.

Borrell Offers New Figures for Local Sites

May 1, 2009

Borrell Associates has always been the most bullish among the firms forecasting and tracking local ad revenues. Their firm’s new report on what “local websites earn” is out. Here’s the chart breaking down what Borrell says is a $12.6 billion local online ad market:

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Source: Borrell Associates

If we take just the directory and newspaper categories, here’s what the percentages translate into:

  • Directories: $1.32 billion
  • Newspapers: $3.2 billion

For 2008, according to the NAA, online newspaper revenues were $3.1 billion. These numbers likely include bundling and are probably not “pure” online advertising.

Per the IAB, full year 2008 online ad revenues were $23 billion. Borrell’s overall number, $12.6 billion, is just over 50% of the IAB’s overall online ad revenue figure. That seems quite high to me. However the directory and newspaper figures above are pretty accurate. I’m not sure if verticals are included in Borrell’s “directories” category however.

Mixed Outlook: What Should Yahoo! Do?

January 30, 2008

Here’s a lengthy post I put together over at SEL that goes through the earnings release and related announcements, including the 1,000 layoffs:

Despite the hopes of many and rumors that Yahoo would post “strong” earnings, Q4 2007 results (.pdf) were mixed and net income was down from a year ago. In addition, CEO Jerry Yang said the company faced “headwinds” in 2008 and offered weak guidance but promised a return to growth in 2009. Investors were unhappy and stock was down at one point 10 percent in after-hours trading (this morning it has recovered).

Here’s my “editorial” view:

Some articles this morning are highly critical of the company arguing that the layoffs offer cost savings but not much more and that Yahoo hasn’t really articulated a vision or offered products that will enable it to regain momentum. Mobile is an area of strength for the company but not yet a meaningful revenue producer.

There may well be a distorting disconnect between the Silicon Valley culture of “buzz” and novelty vs. the larger society, which is interested in utilitarian products and services that meet ordinary and practical needs. Yahoo should avoid worrying about keeping up with the Twitters and instead focus on building products that help people accomplish practical and immediate objectives in their daily lives. This still includes mobile and social media but not necessarily things like “Yahoo Live.” In addition, Yahoo appears to be dropping the ball in local, which has historically been an industry-leading product.

It’s easy for me (and others) to sit back and critique Yahoo! But in making this last set of statements I’m trying a bit more to put myself in Jerry Yang’s shoes. Yahoo! does need one or two “sexy” new products to get the press interested but I think there’s a majority audience for whom Yahoo! could be the most vital and complete site on the Internet.

Yahoo! isn’t going to gain much on Google in search in the near future. But it has to continue to invest in search for many reasons. I think that Yahoo! should make its home page more customizable — more like My Yahoo! — for users who want to take advantage of that option. And mobile is an area it can leverage to strengthen brand loyalty. Yahoo is actually ahead of Google in mobile in many respects, but the Google brand right now has greater strength among power users and early adopters.

As people become more and more overwhelmed with information, Yahoo! is in a strong position to be a leading “trusted content” source for most users. But it does still need a “social center” to pull together some of its disparate properties and content assets. That could potentially be done through a revamping of Yahoo! Groups, through personalization (including the My Yahoo-ification of the home page) and mail (as is being contemplated).

Yahoo! has set expectations now that 2008 will be a mixed year but 2009 will represent a return to strong growth. I think AT&T is the buyer or a major investor if Yang & Co. fail to execute. By the same token executing in a relatively mature company of 14,000 people is tough. But if IBM and Kodak can turn around, so can Yahoo!

What would you do?

Yahoo! Results: Modest Growth, Operating Income Down

July 17, 2007

Here’s the release (pdf). Highlights:

Second Quarter 2007 Financial Results

• Revenues were $1,698 million for the second quarter of 2007, an 8 percent increase compared to $1,576 million for the same period of 2006.
• Marketing services revenues were $1,486 million for the second quarter of 2007, a 7 percent increase compared to $1,386 million for the same period of 2006.
• Marketing services revenues from Owned and Operated sites were $887 million for the second quarter of 2007, an 18 percent increase compared to $752 million for the same period of 2006.
• Marketing services revenues from Affiliate sites were $599 million for the second quarter of 2007, a 5 percent decrease compared to $634 million for the same period of 2006.
• Fees revenues were $212 million for the second quarter of 2007, a 12 percent increase compared to $190 million for the same period of 2006.
• Revenues excluding traffic acquisition costs (“TAC”) were $1,244 million for the second quarter of 2007, an 11 percent increase compared to $1,123 million for the same period of 2006.
• Gross profit for the second quarter of 2007 was $1,015 million, a 9 percent increase compared to $930 million for the same period of 2006.
• Operating income for the second quarter of 2007 was $185 million, a 19 percent decrease compared to $230 million for the same period of 2006.

Segment Financial Results

• United States segment revenues for the second quarter of 2007 were $1,119 million, a 5 percent increase compared to $1,070 million for the same period of 2006.
• International segment revenues for the second quarter of 2007 were $579 million, a 15 percent increase compared to $506 million for the same period of 2006.

Cash Flow Information

Free cash flow was $328 million for the second quarter of 2007 compared to $358 million for the same period of 2006.

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I’ve provided some additional detail as well as some of the details of the earnings call in my SEL post. Here’s the WSJ (sub req’d) article.

Yahoo! Earnings Today, Google’s Thursday

July 17, 2007

Yahoo! announces earnings today at 5 Eastern, 2 Pacific. Flat is the expectation. We’ll see. Yahoo! has only a handful of quarters to show gains and positive momentum before anxious investors start calling for M&A. Google’s earnings will come on Thursday at 4:30 Eastern, 1:30 Pacific.

Kara Swisher makes the somewhat ironic and probably correct observation that a mediocre performance by Yahoo! won’t necessarily affect the stock and a strong performance by Google may also not impact its shares.