IAC/InterActiveCorp Meets Profit Estimates
SAN FRANCISCO -- Internet conglomerate
IAC/InterActive Corp
(IACI)
managed to meet Wall Street's earnings expectations, but its Lending Tree division continues to lose ground.
The company said Wednesday that first-quarter profit fell to $52.8 million, or 18 cents a share, compared with $60.8 million, or 20 cents a share, a year ago.
Adjusted for certain items, earnings totaled $87.2 million, or 30 cents a share, compared with $96.9 million, or 31 cents a share. That was in line with consensus estimates by analysts surveyed by Thomson Financial.
Revenue grew to $1.6 billion from $1.49 billion a year ago, beating Wall Street expectations of $1.53 billion.
IAC's first quarter had been saddled with an ongoing lawsuit filed by
Liberty Media
(LINTA)
, which owns a 30% stake in the company and about 62% of its voting control through a second class of super-voting shares.
Liberty claimed that IAC's chief executive, Barry Diller, was trying to dilute that stake by proposing to break up IAC into five separate companies and give each spin-off a single-tier voting structure.
Last month, a judge
of IAC, saying that Diller didn't need Liberty's permission to propose the spinoffs. However, he left open the possibility that Liberty could come back to sue IAC if its board agreed to restructure the company's voting power.
In a statement Wednesday, Diller maintained that spinoffs are still the way to go.
"With this quarter's results, it couldn't be clearer that we are on the right course in separating IAC into five distinct public entities," he said. "Each of the businesses have their own unique opportunities -- some with current challenges and others with wind at their backs."
Among the ones facing challenges are Lending Tree, as well as the Home Shopping Network. In the first quarter, Lending Tree posted a 38% decline in revenue growth vs. a year ago. The Home Shopping Network posted only a 2% gain vs. a year ago.
Other divisions, however, showed some strength. Interval, which sells vacation time shares, increased first-quarter revenue by 34% while Ticketmaster jumped by 15%. The remaining businesses, which would make up the new IAC under a spinoff scenario and include Ask.com, Evite, Match.com and Citysearch, posted a 22% increase in revenue.
Shares of IAC were recently up 43 cents, or 2.1%, to $20.89.