Dex One's CEO Discusses Q4 2011 Results - Earnings Call Transcript
Second, we expanded our partnership network and struck alliances with 11 leading local, social and mobile players. These agreements are helping to support our $200 million additional business with bookings growth of 30% in the fourth quarter, well ahead of the industry peer group. Third, we simplified how we bring solutions to market with the introduction of service bundles that are easy to sell and easy to buy. Customers have responded favorably to this new approach. In just 6 months, we sold 34,000 bundles. And in the fourth quarter, bundles represented 40% of total bookings. Fourth, we continue to exercise prudent financial discipline and reduce costs by more than $120 million in 2011, bringing the 3-year cumulative expense reduction to $420 million. Lastly, we strengthened capital structure by reducing net debt by $385 million. The actions we took during 2011 directly led to today's announcement that we are pursuing amendments to our credit agreements to enable the company to repurchase outstanding loans below par.
While we are pleased with our progress, we must stabilize the top line by effectively managing the decline [indiscernible] and accelerating the growth of our digital business. Ad sales in the fourth quarter were down 13% within the guidance range. Results were impacted by weaker print sales, which were down 18%, but offset by the very solid digital growth I referenced earlier. Digital services now represent 19% of total bookings. Recent industry reports indicate print advertising revenue will continue to decline at approximately 20% per year for the foreseeable future. While we expect to generate print performance a couple of points ahead of the industry in 2012, digital sales will not overcome print declines. That being said, we expect to maintain our industry-leading margins in part by driving more profitable leads from our owned and operating profits business, and leveraging Dex Net's sophisticated algorithm to cost effectively buy leads in the market. We focus on the 3 p's: people, partnership and packaging to help us capture a greater portion of the rising investment in digital local marketing. We took important steps in each of these 3 areas in 2011.
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