United Online, Inc. (Nasdaq: UNTD), a leading provider of consumer products and services over the Internet, today reported financial results for its third quarter ended September 30, 2012.
“We are continuing to make progress in our plan to spin-off FTD as an independent, publicly-traded company,” said Mark R. Goldston, Chairman, President and Chief Executive Officer of United Online. “We expect to complete the spin-off by August 2013, and are targeting the first half of 2013 to complete this transaction. We are also continuing to review strategic alternatives for our other businesses as we seek to further unlock shareholder value.”
“Looking at our results for the quarter, consolidated revenues and adjusted OIBDA each approached the high end of our guidance range for the quarter,” Goldston said. “During the quarter, the FTD segment achieved its seventh consecutive quarter of year-over-year revenue growth, when prior periods are adjusted for the timing of the U.K. Mother’s Day in 2011. FTD revenues increased 7% from the year-ago quarter, driven by consumer order growth in both the U.S. and international businesses.”
“Content & Media segment pay accounts declined by 133,000 during the quarter, the smallest net decrease since the second quarter of 2010,” Goldston continued. “The quarterly net decrease in segment pay accounts has now improved for three consecutive quarters from a high of 296,000 in the fourth quarter of 2011.”“As we grow the customer base in our NetZero 4G mobile broadband business, we are continuing to test marketing strategies, including discounted pricing on our devices as a means to improve conversion rates,” said Neil P. Edwards, Executive Vice President and Chief Financial Officer. Summary Results for Third Quarter Ended September 30, 2012: The following table summarizes key financial results for the third quarter ended September 30, 2012:
|(in millions, except per share amounts and percentages)|
|Q3 2012||Q3 2011||% Change|
|Content & Media revenues||36.6||44.1||(17||%)|
|GAAP operating income||$||8.4||$||20.2||(58||%)|
|Adjusted OIBDA (1)||$||26.8||$||39.7||(33||%)|
|GAAP net income attributable to common stockholders||$||4.6||$||11.4||(60||%)|
|GAAP diluted net income per common share||$||0.05||$||0.13||(62||%)|
|Adjusted net income attributable to common stockholders (2)||$||12.5||$||20.3||(38||%)|
|Adjusted diluted net income per common share (2)||$||0.14||$||0.23||(39||%)|
- Consolidated revenues were $177.8 million, a 3% decrease compared to the year-ago quarter. Adjusting for the unfavorable impact of foreign currency exchange rates, consolidated revenues in the third quarter of 2012 decreased by 2% compared to the year-ago quarter.
- GAAP operating income was $8.4 million, a decrease of 58% versus the year-ago quarter.
- Consolidated adjusted OIBDA (1) was $26.8 million, a decrease of 33% versus the year-ago quarter. Adjusting for the unfavorable impact of foreign currency exchange rates, consolidated adjusted OIBDA in the third quarter of 2012 decreased by 31% compared to the year-ago quarter.
- Interest expense was $3.3 million, down 13% compared to the year-ago quarter.
- The effective income tax rate was 13%, versus 31% in the year-ago quarter. The decrease in the effective income tax rate was primarily due to an increase in discrete tax benefits relating to the release of reserves for uncertain tax positions and a reduction in the U.K. statutory income tax rate on lower pre-tax income in the third quarter, compared to the year-ago quarter.
- GAAP diluted net income per common share was $0.05, down 62% compared to the year-ago quarter.
- Adjusted diluted net income per common share (2) was $0.14, down 39% compared to the year-ago quarter.