- Record Second Quarter Revenue Increases 23% Year-Over-Year to $121.6 Million
- Year-to-Date Revenue Up 26% Over the Prior Year Period to $216.0 Million
- Number of Registrations Increases 14% Year-Over-Year to 28.0 Million
SAN DIEGO, CALIF. – August 2, 2012 – ACTIVE Network (NYSE: ACTV), the leader in cloud-based activity and participant management™ solutions, today announced its financial results for the second quarter of 2012.
Q2 2012 Financial Highlights:
(All comparisons are made to the second quarter of 2011
- Total net revenue was $121.6 million, up 23% from $99.0 million.
- Technology revenue constituted 89%, or $108.2 million of total net revenue, up 26% from $85.6 million.
- Net registration revenue was $83.9, up 20% - including registration growth of 14% and revenue per registration growth of 5%.
- Marketing services revenue constituted 11%, or $13.4 million of total net revenue.
- Net loss was $2.3 million compared to a net income of $5.5 million.
- Adjusted EBITDA, a non-GAAP financial measure, was $20.2 million. Excluding the impact of business combination accounting rules related to deferred revenue, Adjusted EBITDA was $23.8 million.
"We delivered a strong second quarter with record revenue of $121.6 million, up 23% over the prior year period,” said Dave Alberga, CEO of ACTIVE Network. “During the quarter, we achieved an important technology milestone by launching the first Hunting and Fishing permitting application built on the ACTIVE Works® platform. Our customer base continues to expand, adding key customers such as Aetna, MacWorld, and Edinburgh University Sports Union. We remain focused on strengthening our position as the leading cloud-based provider of activity and participant management solutions and continue to increase penetration in the underdeveloped activities market.”
“We are excited to see positive trends in our key metrics this quarter as registrations, one of our main drivers, accelerated 14% and revenue per registration grew 5% from the prior year period," explained Scott Mendel, CFO of ACTIVE Network. “We experienced growth across all verticals and continued to benefit from a high degree of predictability in our model and strong renewal rates of over 95%.”
Q2 2012 Key Business Highlights
- The Company launched an impressive suite of Business Solutions mobile applications for professional meetings and events planners, attendees and suppliers.
- Aetna and ACTIVE Network partnered to help members become more physically active through Aetna Everactive℠, a new social community that brings together virtual health and fitness resources with opportunities to participate in real-life local events.
- In June, ACTIVE Network launched MeetMobile, an innovative swim app, at the national qualifying swim trials in Omaha. MeetMobile transforms the swim meet experience by giving swimmers, coaches and fans real-time, paperless access to heat sheets and event results at their fingertips. Adoption of the app has been strong with over 110,000 downloads to date and over 3 million user sessions.
Business Outlook
For the third quarter of 2012, ACTIVE Network is targeting total revenue to be in the range of $108 million to $111 million, up 22% at the midpoint compared to the same period in the prior year. Registrations are expected to grow approximately 13% to 15% and revenue per registration growth of approximately 2% to 4% compared to the same period in the prior year. The Company expects Adjusted EBITDA in the range of $14 million to $16 million. Excluding the impact of business combination accounting rules, Adjusted EBITDA is expected to be in the range of $16 million to $18 million. The Company expects a net loss of $8 million to $4 million.
For the full year of 2012, ACTIVE Network is tightening its initial guidance range. Total revenue is expected to be in the range of $425 million to $430 million, up 27% at the midpoint compared to the prior year. Adjusted EBITDA is expected to be in the range of $46 million to $48 million. Excluding the impact of business combination accounting rules, Adjusted EBITDA is expected to be in the range of $58.5 million to $60.5 million. The Company expects net loss in the range of $38 million to $31 million.
Conference Call Information
ACTIVE Network will host a conference call to discuss second quarter 2012 results today at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time). The conference call dial-in number is (866) 202-0886 for domestic participants and (617) 213-8841 for international participants. A live webcast of the conference call will also be available and can be accessed within the investor relations section of the ACTIVE Network corporate website at: http://investors.ACTIVEnetwork.com.
A replay of the call will be available starting at 7:30 p.m. Eastern Time (4:30 p.m. Pacific Time) on August 2, 2012 through 11:59 p.m. Eastern Time (8:59 p.m. Pacific Time) on August 7, 2012. To listen to the replay, dial (888) 286-8010 or (617) 801-6888 outside of the United States and use the passcode 58040522. The replay will also be available via webcast at: http://investors.ACTIVEnetwork.com.
About ACTIVE Network
ACTIVE Network (NYSE: ACTV) is on a mission to make the world a more active place. With deep expertise in activity and participant management™, our ACTIVE Works® cloud technology helps organisers transform and grow their businesses. We do this through technology solutions that power the world’s activities and through online destinations such as ACTIVE.com® that connect people with the things they love to do. Serving over 50,000 global business customers and driving over 80 million transactions annually, we help organisers get participants, manage their events and build communities. ACTIVE Network is headquartered in San Diego, California and has over 30 offices worldwide. Learn more at ACTIVEnetwork.com or ACTIVE.com and engage with us on Twitter @ACTIVEnetwork, @ACTIVE and on Facebook.
Note With Respect to Non-GAAP Financial Measures
In addition to using GAAP financial results, the Company's management measures and reports non-GAAP financial measures, including Adjusted EBITDA, Non-GAAP net income (loss) and Non-GAAP net income (loss) per share. The most directly comparable GAAP financial results for these non-GAAP financial measures are Net income (loss), Net income (loss) and Net income (loss) per share, respectively. Management uses these non-GAAP financial measures to evaluate the Company's performance and operations. Management also uses these non-GAAP financial measures for business planning, to evaluate acquisition opportunities and as a measurement to create incentives and to compensate the Company's management team. In addition, management believes the exclusion or inclusion of certain amounts in calculating these non-GAAP financial measures can provide a useful measure to investors for period-to-period comparisons. These non-GAAP financial measures, however, should be used in addition to, and in conjunction with, the Company's financial results presented in accordance with GAAP. The Company strongly encourages investors to review its financial statements in their entirety and to not rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare the Company's results with other companies' non-GAAP financial measures having the same or similar names. Please see Reconciliation of GAAP to Non-GAAP Results below for a reconciliation of our GAAP to non-GAAP financial measures.
Forward-Looking Statements
The Active Network, Inc. cautions you that the statements included in this press release that are not a description of historical facts are forward-looking statements within the meaning of the federal securities laws. Any such statements are subject to substantial risks and uncertainties, including the Company's ability to generate revenue and control expenses in order to achieve and maintain profitability, the Company's ability to maintain an adequate rate of growth, including growing its registrations and revenue from registrations, and the Company's ability to successfully manage its acquisitions and investments in businesses, applications and technologies, as well as the other risks detailed from time to time in the reports it files with the Securities and Exchange Commission. As a result of these risks and uncertainties, the Company's actual results may differ materially from those expressed in any forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement and the Company undertakes no obligation to revise or update this press release to reflect events or circumstances after the date hereof.
THE ACTIVE NETWORK, INC. | ||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||
(Unaudited) | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Net Revenue: | ||||||||||||||||
Technology revenue | $ | 108,155 | $ | 85,553 | $ | 192,275 | $ | 148,661 | ||||||||
Marketing services revenue | 13,409 | 13,452 | 23,727 | 23,056 | ||||||||||||
Total net revenue | 121,564 | 99,005 | 216,002 | 171,717 | ||||||||||||
Cost of net revenue: | ||||||||||||||||
Cost of technology revenue | 50,812 | 38,707 | 96,467 | 71,695 | ||||||||||||
Cost of marketing services revenue | 2,115 | 1,480 | 3,431 | 2,642 | ||||||||||||
Total cost of net revenue | 52,927 | 40,187 | 99,898 | 74,337 | ||||||||||||
Gross profit | 68,637 | 58,818 | 116,104 | 97,380 | ||||||||||||
Operating expenses: | ||||||||||||||||
Sales and marketing | 24,284 | 18,914 | 49,308 | 35,854 | ||||||||||||
Research and development | 21,121 | 16,377 | 42,330 | 32,553 | ||||||||||||
General and administrative | 16,903 | 12,308 | 33,447 | 22,896 | ||||||||||||
Amortization of intangibles | 5,596 | 3,718 | 11,288 | 7,421 | ||||||||||||
Total operating expenses |
67,904 | 51,317 | 136,373 | 98,724 | ||||||||||||
(Loss) income from operations | 733 | 7,501 | (20,269 | ) | (1,344 | ) | ||||||||||
Interest income | 25 | 29 | 50 | 59 | ||||||||||||
Interest expense | (90 | ) | (1,406 | ) | (241 | ) | (2,690 | ) | ||||||||
Other income (expense), net | (524 | ) | 193 | 877 | 142 | |||||||||||
(Loss) income before provision for income taxes | 144 | 6,317 | (19,583 | ) | (3,833 | ) | ||||||||||
Provision for income taxes | 2,469 | 788 | 3,080 | 1,580 | ||||||||||||
Net (loss) income | (2,325 | ) | 5,529 | (22,663 | ) | (5,413 | ) | |||||||||
Accretion of redeemable convertible preferred stock | - | (4,400 | ) | - | (11,810 | ) | ||||||||||
Net (loss) income attributable to common stockholders | $ | (2,325 | ) | $ | 1,129 | $ | (22,663 | ) | $ | (17,223 | ) | |||||
Net (loss) income per share attributable to common stockholders: | ||||||||||||||||
Basic | $ | (0.04 | ) | $ | 0.04 | $ | (0.39 | ) | $ | (0.96 | ) | |||||
Diluted | $ | (0.04 | ) | $ | 0.03 | $ | (0.39 | ) | $ | (0.96 | ) | |||||
Weighted-average shares used to compute net (loss) income | ||||||||||||||||
per share attributable to common stockholders: | ||||||||||||||||
Basic | 58,322 | 27,269 | 57,655 | 17,943 | ||||||||||||
Diluted | 58,322 | 36,877 | 57,655 | 17,943 | ||||||||||||
THE ACTIVE NETWORK, INC. | ||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
(In thousands) | ||||||||
June 30, | December 31, | |||||||
2012 | 2011 | |||||||
(Unaudited) | ||||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 107,806 | $ | 108,699 | ||||
Restricted cash | 875 | 1,502 | ||||||
Accounts receivable, net | 80,926 | 66,469 | ||||||
Inventories | 3,973 | 1,662 | ||||||
Prepaid expenses and other current assets | 7,249 | 6,179 | ||||||
Total current assets | 200,829 | 184,511 | ||||||
Property and equipment, net | 33,690 | 33,830 | ||||||
Software development costs, net | 48,105 | 45,093 | ||||||
Goodwill | 243,089 | 243,320 | ||||||
Intangible assets, net | 76,026 | 90,340 | ||||||
Other long-term assets | 2,322 | 2,133 | ||||||
Total assets | $ | 604,061 | $ | 599,227 | ||||
Liabilities and stockholders’ equity | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 6,903 | $ | 8,516 | ||||
Registration fees payable | 112,349 | 72,405 | ||||||
Accrued expenses | 39,078 | 41,106 | ||||||
Deferred revenue | 67,886 | 54,919 | ||||||
Current portion of long-term debt | 10,000 | 5,000 | ||||||
Capital lease obligations, current portion | 1,431 | 3,317 | ||||||
Other current liabilities | 2,976 | 42,613 | ||||||
Total current liabilities | 240,623 | 227,876 | ||||||
Capital lease obligations, net of current portion | 801 | 1,652 | ||||||
Other long-term liabilities | 5,915 | 6,147 | ||||||
Deferred tax liability | 18,700 | 16,913 | ||||||
Total liabilities | 266,039 | 252,588 | ||||||
Stockholders’ equity: | ||||||||
Common stock | 61 | 58 | ||||||
Treasury stock | (11,959 | ) | (11,959 | ) | ||||
Additional paid-in capital | 639,955 | 625,875 | ||||||
Accumulated other comprehensive income | 7,886 | 7,923 | ||||||
Accumulated deficit | (297,921 | ) | (275,258 | ) | ||||
Total stockholders’ equity | 338,022 | 346,639 | ||||||
Total liabilities and stockholders’ equity | $ | 604,061 | $ | 599,227 | ||||
THE ACTIVE NETWORK, INC. | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
(In thousands) | ||||||||
(Unaudited) | ||||||||
Six Months Ended | ||||||||
June 30, | ||||||||
2012 | 2011 | |||||||
Operating activities | ||||||||
Net loss | $ | (22,663 | ) | $ | (5,413 | ) | ||
Adjustments to reconcile net loss to net cash provided by operating activities: |
||||||||
Depreciation and amortization | 30,094 | 21,508 | ||||||
Stock-based compensation expense | 7,331 | 2,812 | ||||||
Deferred tax liability | 1,799 | 1,570 | ||||||
Other non-cash items | (931 | ) | 1,217 | |||||
Change in operating assets and liabilities, net of effect of acquisitions: | ||||||||
Restricted cash | 627 | - | ||||||
Accounts receivable | (14,690 | ) | (21,797 | ) | ||||
Inventories | (2,311 | ) | (1,810 | ) | ||||
Prepaid expenses and other assets | (1,318 | ) | (3,498 | ) | ||||
Accounts payable and accrued expenses | (3,201 | ) | 782 | |||||
Registration fees payable | 39,944 | 58,899 | ||||||
Income taxes payable | 249 | - | ||||||
Deferred revenue | 13,105 | 11,461 | ||||||
Deferred rent | 184 | 661 | ||||||
Net cash provided by operating activities | 48,219 | 66,392 | ||||||
Investing activities | ||||||||
Purchases of property and equipment | (9,343 | ) | (5,326 | ) | ||||
Capitalized software development | (10,996 | ) | (9,481 | ) | ||||
Cash (paid) received for acquisitions, net of cash acquired | (38,037 | ) | 520 | |||||
Payment of contingent consideration | - | (625 | ) | |||||
Net cash used in investing activities | (58,376 | ) | (14,912 | ) | ||||
Financing activities | ||||||||
Proceeds from issuance of common stock and repurchase of unvested common stock |
6,850 | 2,747 | ||||||
Payments on capital lease obligations | (2,737 | ) | (1,233 | ) | ||||
Proceeds from (repayments of) long-term debt | 5,000 | (41,628 | ) | |||||
Net proceeds from initial public offering | - | 114,700 | ||||||
Net cash provided by financing activities | 9,113 | 74,586 | ||||||
Effect of exchange rates on cash | 151 | - | ||||||
Net (decrease) increase in cash and cash equivalents | (893 | ) | 126,066 | |||||
Cash and cash equivalents at beginning of period | 108,699 | 31,441 | ||||||
Cash and cash equivalents at end of period | $ | 107,806 | $ | 157,507 | ||||
THE ACTIVE NETWORK, INC. |
||||||||||||||||||||||
SUPPLEMENTARY DATA |
||||||||||||||||||||||
(In thousands, except revenue per registration) |
||||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||||
Operational Data: | Three Months Ended | Six Months Ended | ||||||||||||||||||||
June 30, | % | June 30, | % | |||||||||||||||||||
2012 | 2011 | change | 2012 | 2011 | change | |||||||||||||||||
Net registration revenue | $ | 83,854 | $ | 69,741 | 20 | % | $ | 147,373 | $ | 121,174 | 22 | % | ||||||||||
Registrations | 28,036 | 24,597 | 14 | % | 46,259 | 39,456 | 17 | % | ||||||||||||||
Net registration revenue per registration | $ | 2.99 | $ | 2.84 | 5 | % | $ | 3.19 | $ | 3.07 | 4 | % | ||||||||||
Gross Profit Margin: | Three Months Ended | % or | Six Months Ended | % or | ||||||||||||||||||
June 30, | bps | June 30, | bps | |||||||||||||||||||
2012 | 2011 | change | 2012 | 2011 | change | |||||||||||||||||
Total net revenue | $ | 121,564 | $ | 99,005 | 23 | % | $ | 216,002 | $ | 171,717 | 26 | % | ||||||||||
Add: impact of business combination | ||||||||||||||||||||||
accounting rules | 3,652 | 252 | 8,268 | 585 | ||||||||||||||||||
Non-GAAP total net revenue | $ | 125,216 | $ | 99,257 | 26 | % | $ | 224,270 | $ | 172,302 | 30 | % | ||||||||||
GAAP gross profit | $ | 68,637 | $ | 58,818 | 17 | % | $ | 116,104 | $ | 97,380 | 19 | % | ||||||||||
Add back: stock-based compensation | 192 | 39 | 252 | 55 | ||||||||||||||||||
Add back: depreciation & amortization | 7,950 | 5,544 | 15,668 | 10,899 | ||||||||||||||||||
Add: impact of business combination | ||||||||||||||||||||||
accounting rules | 3,652 | 252 | 8,268 | 585 | ||||||||||||||||||
Non-GAAP gross profit | $ | 80,431 | $ | 64,653 | 24 | % | $ | 140,292 | $ | 108,919 | 29 | % | ||||||||||
Gross profit margin: | ||||||||||||||||||||||
GAAP gross profit margin | 56.5 | % | 59.4 | % | (290) bps | 53.8 | % | 56.7 | % | (290) bps | ||||||||||||
Non-GAAP gross profit margin | 64.2 | % | 65.1 | % | (90) bps | 62.6 | % | 63.2 | % | (60) bps | ||||||||||||
Stock-Based Compensation Expense: | Three Months Ended | Six Months Ended | ||||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||||||||
Cost of net revenue | $ | 192 | $ | 39 | $ | 252 | $ | 55 | ||||||||||||||
Sales and marketing | 1,006 | 576 | 1,702 | 763 | ||||||||||||||||||
Research and development | 668 | 203 | 1,120 | 321 | ||||||||||||||||||
General and administrative | 2,436 | 1,250 | 4,257 | 1,673 | ||||||||||||||||||
Total stock-based compensation | $ | 4,302 | $ | 2,068 | $ | 7,331 | $ | 2,812 | ||||||||||||||
THE ACTIVE NETWORK, INC. | ||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP RESULTS | ||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||
(Unaudited) | ||||||||||||||||
Non-GAAP Earnings: | Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Non-GAAP net (loss) income: | ||||||||||||||||
GAAP net (loss) income | $ | (2,325 | ) | $ | 5,529 | $ | (22,663 | ) | $ | (5,413 | ) | |||||
Add back: stock-based compensation | 4,302 | 2,068 | 7,331 | 2,812 | ||||||||||||
Add back: amortization of intangibles | 7,074 | 5,151 | 14,231 | 10,247 | ||||||||||||
Add: impact of business combination accounting rules | 3,652 | 252 | 8,268 | 585 | ||||||||||||
Income tax effect | (5,260 | ) | (2,615 | ) | (10,441 | ) | (4,775 | ) | ||||||||
Non-GAAP net (loss) income | $ | 7,443 | $ | 10,385 | $ | (3,274 | ) | $ | 3,456 | |||||||
Non-GAAP shares: | ||||||||||||||||
GAAP shares - basic | 58,322 | 27,269 | 57,655 | 17,943 | ||||||||||||
Add: preferred stock conversion | - | 20,551 | - | 27,552 | ||||||||||||
Non-GAAP shares - basic | 58,322 | 47,820 | 57,655 | 45,495 | ||||||||||||
GAAP shares - diluted | 58,322 | 36,877 | 57,655 | 17,943 | ||||||||||||
Add: preferred stock and other securities conversion | 6,640 | 20,551 | - | 36,754 | ||||||||||||
Non-GAAP shares - diluted | 64,962 | 57,428 | 57,655 | 54,697 | ||||||||||||
Non-GAAP net (loss) income per share: | ||||||||||||||||
Basic | $ | 0.13 | $ | 0.22 | $ | (0.06 | ) | $ | 0.08 | |||||||
Diluted | $ | 0.11 | $ | 0.18 | $ | (0.06 | ) | $ | 0.06 | |||||||
Adjusted EBITDA: | Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Net (loss) income | $ | (2,325 | ) | $ | 5,529 | $ | (22,663 | ) | $ | (5,413 | ) | |||||
Add back: interest expense, net | 65 | 1,377 | 191 | 2,631 | ||||||||||||
Add back: provision for income taxes | 2,469 | 788 | 3,080 | 1,580 | ||||||||||||
Add back: depreciation and amortization | 15,118 | 10,837 | 30,094 | 21,508 | ||||||||||||
Add back: stock-based compensation | 4,302 | 2,068 | 7,331 | 2,812 | ||||||||||||
Add back: other (income) expense, net | 524 | (193 | ) | (877 | ) | (142 | ) | |||||||||
Adjusted EBITDA | $ | 20,153 | $ | 20,406 | $ | 17,156 | $ | 22,976 | ||||||||
Add: impact of business combination accounting rules | 3,652 | 252 | 8,268 | 585 | ||||||||||||
Adjusted EBITDA excluding the impact of business combination accounting rules |
$ | 23,805 | $ | 20,658 | $ | 25,424 | $ | 23,561 | ||||||||
THE ACTIVE NETWORK, INC. |
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FUTURE PERFORMANCE - 3RD QUARTER AND FULL YEAR 2012 OUTLOOK |
|||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP RESULTS |
|||||||||||||||||
(In thousands) |
|||||||||||||||||
Estimated | Estimated | ||||||||||||||||
3rd Quarter 2012 | Full Year 2012 | ||||||||||||||||
Low End | High End | Low End | High End | ||||||||||||||
Net loss | $ | (8,000 | ) | $ | (4,000 | ) | $ | (38,000 | ) | $ | (31,000 | ) | |||||
Interest, taxes and other | 1,000 | 1,000 | 4,000 | 3,000 | |||||||||||||
Depreciation and amortization | 16,000 | 15,000 | 62,000 | 60,000 | |||||||||||||
Stock-based compensation | 5,000 | 4,000 | 18,000 | 16,000 | |||||||||||||
Adjusted EBITDA | $ | 14,000 | $ | 16,000 | $ | 46,000 | $ | 48,000 | |||||||||
Add: impact of business combination accounting rules | 2,000 | 2,000 | 12,500 | 12,500 | |||||||||||||
Adjusted EBITDA excluding the impact of business combination accounting rules |
$ | 16,000 | $ | 18,000 | $ | 58,500 | $ | 60,500 | |||||||||
###
© 2012 The Active Network, Inc. All rights reserved. Active.com, ActiveWorks and StarCite are registered trademarks of The Active Network, Inc. Active Network is a trademark of The Active Network, Inc. All other trademarks are the property of their respective owners.
Media Contact:
Mona Klausing, Active Network
Mona.Klausing@ActiveNetwork.com
1-858-964-3813
Investor Contact:
Brinlea Johnson, The Blueshirt Group
Brinlea@BlueshirtGroup.com
1-212-331-8424