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Neustar Reports Results For Third Quarter 2013

Stocks in this article: NSR

Neustar, Inc. (NYSE: NSR), a trusted, neutral provider of real-time information services and analysis, today announced results for the quarter ended September 30, 2013, and in a separate release stated that it has acquired Aggregate Knowledge, Inc., a leading campaign and predictive analytics platform, for approximately $119 million in cash consideration.

Results for Third Quarter 2013 Compared to Third Quarter 2012

  • Revenue increased 8% to $227.6 million
  • Non-NPAC revenue increased 9% to $118.3 million
  • Net income increased 4% to $47.5 million. Net income for the third quarter of 2012 included $5.2 million of discrete income tax benefits
  • Net income per share increased 7% to $0.73

Non-GAAP Results for Third Quarter 2013 Compared to Third Quarter 2012

  • Adjusted net income increased 3% to $62.3 million, representing a 27% margin. Adjusted net income for the third quarter of 2012 included $5.2 million of discrete income tax benefits
  • Adjusted net income per share increased 6% to $0.95

“We continue to execute on our strategic plan and deliver on our 2013 priorities,” said Lisa Hook, Neustar's President and Chief Executive Officer. “We have continued to position ourselves for a successful NPAC renewal while broadening our information and analytics capabilities with the addition of the Aggregate Knowledge platform.”

Paul Lalljie, Neustar’s Chief Financial Officer, added, “During the third quarter, we continued to drive shareholder value through our disciplined expense management and commitment to return cash to shareholders. We continued to experience increased demand for our services but sales cycles have been longer than anticipated, mainly for certain of our information services.”

Discussion of Third Quarter Results

Consolidated revenue totaled $227.6 million, an 8% increase from $211.2 million in the third quarter of 2012. In particular:

  • Carrier Services revenue totaled $139.5 million, an 11% increase from $125.2 million in 2012. This increase was primarily due to a $6.7 million increase in NPAC Services revenue and a $6.2 million increase in Order Management Services revenue;
  • Enterprise Services revenue totaled $44.9 million, a 3% increase from $43.6 million in 2012. This increase was due to a 9% increase in Internet Infrastructure Services revenue, partially offset by a decrease in Registry Services revenue driven by one-time project-related revenue in 2012; and
  • Information Services revenue totaled $43.3 million, a 2% increase from $42.3 million in 2012.

Operating expense totaled $147.2 million, an 8% increase from $136.5 million in the third quarter of 2012. This increase was driven by investments to support business growth, in particular, professional fees increased to pursue new business opportunities and to support the company’s long-term sales strategy. In addition, advertising and marketing costs increased to promote awareness of the company’s services and solutions. Cash, cash equivalents and investments totaled $352.7 million as of September 30, 2013, compared to $381.6 million as of June 30, 2013 and to $343.9 million as of December 31, 2012. During the third quarter, the company purchased approximately 1.8 million shares at an average price of $52.06 per share, for approximately $96.1 million.

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