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Ancestry.com Inc. Reports 2010 Financial Results

These forward-looking statements should not be relied upon as representing our views as of any subsequent date and we assume no obligation to publicly update or revise these forward-looking statements for any reason, whether as a result of new information, future events, or otherwise.

Ancestry.com Inc.
Consolidated Balance Sheets
(in thousands)
  December 31, December 31,
  2010 2009
Assets (unaudited)  
 Current assets:    
 Cash and cash equivalents  $ 65,519  $ 66,941
 Restricted cash  2,476  2,181
 Short-term investments  --   33,331
 Accounts receivable, net  6,990  5,860
 Income tax receivable  8,094  2,017
 Deferred income taxes  3,873  8,797
 Prepaid expenses and other current assets  9,243  5,380
 Total current assets 96,195  124,507
 Property and equipment, net  21,252  19,430
 Content database costs, net  65,418  49,650
 Intangible assets, net  34,281  41,484
 Goodwill  303,374  285,466
 Other assets  1,666  2,811
 Total assets  $ 522,186  $ 523,348
Liabilities and stockholders' equity    
 Current liabilities:    
 Accounts payable  $ 9,451  $ 6,877
 Accrued expenses  30,785  18,850
 Escrow liability  6,193  1,763
 Deferred revenues  89,301  69,711
 Current portion of long-term debt  --   28,416
 Total current liabilities 135,730 125,617
 Long-term debt, less current portion  --   71,609
 Deferred income taxes  20,571  30,117
 Other long-term liabilities  2,018  1,115
 Total liabilities 158,319 228,458
Commitments and contingencies    
 Stockholders' equity:    
 Common stock  45  42
 Additional paid-in capital  328,957  272,513
 Accumulated other comprehensive income (loss)  643  (41)
 Retained earnings  34,222  22,376
 Total stockholders' equity 363,867 294,890
Total liabilities and stockholders' equity  $ 522,186  $ 523,348
 
Ancestry.com Inc.
Consolidated Statements of Income
(in thousands, except per share data)
         
  Three Months Ended Year Ended
  December 31, 2010 December 31, 2009 December 31, 2010 December 31, 2009
Revenues: (unaudited)  (unaudited)    
 Subscription revenues  $ 77,327  $ 55,201  $ 281,670  $ 207,707
 Product and other revenues  5,408  4,908  19,261  17,195
 Total revenues  82,735  60,109  300,931  224,902
Costs of revenues:        
 Cost of subscription revenues  12,413  10,428  46,409  40,183
 Cost of product and other revenues  1,769  1,927  5,698  6,140
 Total cost of revenues  14,182  12,355  52,107  46,323
Gross profit  68,553  47,754  248,824  178,579
Operating expenses:        
 Technology and development  11,849  9,546  42,296  36,236
 Marketing and advertising  23,512  17,399  94,573  61,625
 General and administrative  10,475  7,971  35,390  32,540
 Amortization of acquired intangible assets  4,810  4,052  15,959  16,217
 Total operating expenses  50,646  38,968  188,218  146,618
Income from operations  17,907  8,786  60,606  31,961
 Interest expense  (187)  (1,355)  (5,083)  (6,139)
 Interest income  46  46  386  792
 Other income, net  41  7  439  21
Income before income taxes  17,807  7,484  56,348  26,635
 Income tax expense  (5,256)  1,587  (19,503)  (5,340)
Net income  $ 12,551  $ 9,071  $ 36,845  $ 21,295
         
Net income per common share        
Basic  $ 0.28  $ 0.22  $ 0.85  $ 0.55
Diluted  $ 0.25  $ 0.20  $ 0.76  $ 0.51
Weighted average common shares outstanding        
 Basic   45,125  40,857  43,592  38,930
 Diluted   49,980  45,458  48,722  41,533
         
Reconciliation of adjusted EBITDA and free cash flow to net income:      
Net Income  $ 12,551  $ 9,071  $ 36,845  $ 21,295
 Interest expense, net  141  1,309  4,697  5,347
 Income tax expense  5,256  (1,587)  19,503  5,340
 Depreciation expense   3,418  2,844  11,773  10,936
 Amortization expense  6,813  5,868  23,526  23,214
 Stock-based compensation  1,528  1,209  5,069  5,474
 Other income, net  (41)  (7)  (439)  (21)
         
Adjusted EBITDA  $ 29,666  $ 18,707  $ 100,974  $ 71,585
 Capitalization of content database costs  (5,340)  (3,543)  (13,874)  (9,398)
 Purchase of property and equipment  (5,071)  (5,796)  (12,968)  (13,362)
 Cash paid for interest  (117)  (1,116)  (2,645)  (7,740)
 Cash paid for income taxes  (4,783)  (2,487)  (11,128)  (11,472)
Free cash flow  $ 14,355  $ 5,765  $ 60,359  $ 29,613
 
Ancestry.com Inc.
Other Data
           
  Three Months Ended
  December 31, 2010 September 30, 2010 June 30, 2010 March 31, 2010 December 31, 2009
Total Subscribers  1,394,910  1,376,974  1,310,562  1,211,978  1,066,123
Gross subscriber additions  202,509  251,738  290,589  279,100  165,241
Monthly churn 3.9% 4.0% 4.3% 3.3% 3.6%
Subscriber acquisition cost  $ 96.87  $ 81.58  $ 74.04  $ 69.57  $ 85.21
Average monthly revenue per subscriber  $ 17.78  $ 17.75  $ 18.02  $ 16.70  $ 16.67

 

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