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Bankrate Announces Fourth Quarter & Full Year 2012 Financial Results

Stocks in this article: RATE

Adjusted EPS, as outlined in the attached reconciliation, were $0.06 for the fourth quarter of 2012, compared to Adjusted EPS of $0.19 for the fourth quarter of 2011, representing a decrease of 68%. Adjusted EPS were $0.56 for the full year 2012, compared to $0.61 in 2011, representing a decrease of 8%.

Adjusted EBITDA, as outlined in the attached reconciliation, were $17.9 million, with a margin of 19%, in the fourth quarter of 2012 compared to $38.5 million, with a margin of 34%, in the fourth quarter of 2011, a decrease of 53%. For the full year 2012, Adjusted EBITDA were $123.1 million, compared to $135.4 million in 2011, a decrease of 9%.

2013 Guidance

Bankrate expects revenue for 2013 to be relatively flat compared to 2012 with an Adjusted EBITDA margin in the low to mid 20% range. In addition, the Company expects the first half of 2013 to show a year over year decrease in revenue of 10% to 20%, and the second half of 2013 to post a year over year revenue increase of 10% to 20%.

"In insurance, the strategic transition to higher quality, high-margin leads is moving even more aggressively forward --- and with our deep cuts of poor performing traffic behind us in Q4, is now on-track in many of our key criteria, such as agent sign ups and retention," said Thomas R. Evans, President and CEO of Bankrate, Inc. "That's why we see Q4 as the bottoming out of that transition curve that we've discussed in the last two quarters. Encouragingly, in credit cards, we’re beginning to see the increased marketing activity across our portfolio of card issuers after a period of marketplace caution," Mr. Evans added.

Fourth Quarter & Full Year 2012 Financial Highlights

  • Total revenue for the quarter was $93.2 million, a decrease of 18%, or $20.5 million from the $113.8 million in 2011. Revenue for the full year totaled $457.2 million, up 8% or $33.0 million vs. 2011.
  • Adjusted EBITDA of $17.9 million in the fourth quarter was 53% or $20.6 million lower compared to the fourth quarter of 2011. For the full year 2012, Adjusted EBITDA was $123.1 million vs. $135.4 million in 2011 or down 9%.
  • Display advertising, or CPM revenue, in the fourth quarter was 18% higher compared to the same period last year. For the full year 2012, CPM product revenue was up 26% vs. the prior year.
  • Hyperlink, or CPC revenue, for the quarter was 18% higher compared to the same period last year. Full year 2012 CPC revenue was up 65% vs. 2011.
  • Lead generation revenue, which consists of CPA and CPL revenue, was 29% lower compared to the fourth quarter 2011. For the full year 2012, lead generation revenue was 5% lower vs. 2011. Marketing by credit card issuers on the Company’s platform was significantly lower compared to historically high Q4 2011 and full year 2011 levels. In addition the Company continues to transition its insurance business to higher quality, higher converting volume and to reduce lesser converting lead sources. As a result, low agent termination rates in Q4 2012 led to a sequential increase in the number of purchasing agents in January 2013.
  • At the end of the fourth quarter, the company’s leverage ratio was 0.9x on a net debt basis based on the company’s trailing twelve month Adjusted EBITDA of $123.1 million compared to 0.9x at the end of the third quarter of 2012.

Share Repurchase Program

Bankrate’s Board of Directors has authorized a $70 million share repurchase program. The program is effective immediately and authorizes the repurchase of up to $70 million of Bankrate’s common stock in open market or private transactions. The timing of the repurchases will depend on several factors, including prevailing market conditions and prices. The program will expire on December 31, 2014.

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