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TheStreet Open House

Velti Announces Fourth Quarter And Fiscal Year 2012 Results

Stock quotes in this article: VELT

DUBLIN, Ireland and SAN FRANCISCO, March 12, 2013 (GLOBE NEWSWIRE) -- Velti plc (Nasdaq:VELT), the leading global provider of mobile marketing and advertising technology and solutions, today announced its financial results for the fourth quarter and fiscal year ended Dec. 31, 2012.

"Our full year 2012 results show a 43 percent increase in revenue over 2011, even though the fourth quarter was a difficult quarter," said Alex Moukas, chief executive officer. "In the fourth quarter, revenue came in at the low end of our expectations, which, in conjunction with higher operating expenses, contributed to significantly lower adjusted EBITDA.

"Following the divestment announced in November, we continue to evaluate the customers and opportunities that we are pursuing in various geographies. We decided not to pursue certain business opportunities with customers or potential customers that did not meet our more rigorous cash investment requirements, and requirements for improved cash collections and reductions in business in economically challenged regions.

"At the same time, in the fourth quarter and beyond we are very pleased with the sales activity, prospective customer engagements and revenue growth in key markets, including the U.S., Western Europe, Brazil and India. We have built up dedicated sales teams and a complete portfolio of products and services in each of these markets and are confident in our growth opportunities as we gain momentum over the course of 2013 and into the future."

"We believe that 2013 will be a transitional year allowing us to deliver significant revenue growth in our business in the key markets as well as significantly improved cash flow," added Jeff Ross, chief financial officer. "We further believe that we will show sequential growth and financial improvement throughout the year and beyond."

Fiscal Year 2012 Financial Highlights

  • Revenue of $270.3 million, an increase of 43 percent from fiscal year 2011;
  • Revenue less 3rd party costs of $178.9 million (resulting in a margin of 66 percent), an increase of 32 percent compared with revenue less 3rd party costs from fiscal year 2011;
  • Adjusted EBITDA of $42.6 million, which includes a $7.4 million allowance for doubtful accounts; this is a decrease of 20 percent from fiscal year 2011;
  • GAAP net loss attributable to Velti of $56.4 million and EPS of $(0.88) compared with a net loss of $15.4 million and EPS of $(0.28) for fiscal year 2011, including $16.9 million related to the write-off of certain capitalized software and;
  • Adjusted net income of $22.2 million and adjusted diluted EPS of $0.34 compared with adjusted net income of $29.0 million and adjusted diluted EPS of $0.50 for 2011.

Mobile Advertising and Marketing Revenues and Third Party Costs

  • Mobile advertising revenue of $54.3 million, an increase of 82 percent from fiscal year 2011 and mobile advertising 3rd party costs of $41.1 million; resultant mobile advertising revenue less 3rd party costs of $13.3 million (resulting in a margin of 24 percent);
  • Mobile marketing revenue of $216.0 million, an increase of 36 percent from fiscal year 2011 and mobile marketing 3rd party costs of $50.3 million; resultant mobile marketing revenue less 3rd party costs of $165.7 million (resulting in a margin of 77 percent).

Q4 2012 Financial Highlights

  • Revenue of $97.5 million, an increase of 12 percent from Q4 2011;
  • Revenue less 3rd party costs of $66.6 million (resulting in a margin of 68 percent), a decrease of 2 percent compared with revenue less 3rd party costs from Q4 2011;
  • Adjusted EBITDA of $25.1 million, compared with $43.1 million in Q4 2011, a decrease of 42 percent;
  • GAAP net loss attributable to Velti of $5.2 million and diluted EPS of $(0.08) compared with net income of $25.0 million and EPS of $0.40 for Q4 2011;
  • Adjusted net income of $26.0 million and adjusted diluted EPS of $0.39 compared with adjusted net income of $37.3 million and adjusted diluted EPS of $0.59 for Q4 2011;

Mobile Advertising and Marketing Revenues and Third Party Costs

  • Mobile advertising revenue of $15.2 million, an increase of 53 percent from Q4 2011 and mobile advertising 3rd party costs of $10.8 million; resultant mobile advertising revenue less 3rd party costs of $4.5 million (resulting in a margin of 29 percent);
  • Mobile marketing revenue of $82.2 million, an increase of 7 percent from Q4 2011 and mobile marketing 3rd party costs of $20.1 million; resultant mobile marketing revenue less 3rd party costs of $62.2 million (resulting in a margin of 76 percent).

Cash and Comprehensive DSOs

  • Cash position of $36.6 million as of Dec. 31, 2012;
  • Q4 operating cash flow of $7.3 million;
  • Comprehensive DSOs of 311 days;
  • Q4 free cash flow of ($5.0) million.

Please see the reconciliation of net income (loss) before non-controlling interest to adjusted EBITDA later in this release.

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