, Inc. (



Q3 2010 Earnings Call

November 04, 2010 04:30 am ET


Daryl Otte - CEO

Greg Barton - EVP, Business and Legal Affairs, General Counsel and Secretary

Tom Etergino - EVP, CFO


Vik Mehta - J. Goldman

Michael Moskoff - MRM Capital



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Good day, ladies and gentlemen and welcome to the third quarter 2010 earnings conference call. My name is Lucie and I'll be your coordinator for today. At this time all participants are in a listen-only mode. Later we'll facilitate a question-and-answer session. (Operator Instructions). As a reminder, this conference is being recorded for replay purposes.

I would now like to turn the presentation over to your host for today's call, Mr. Daryl Otte, CEO. Please proceed, sir.

Daryl Otte

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Thanks, Lucie. Hi everyone. I'd like to welcome you to's third quarter 2010 earnings call. I am Daryl Otte, the company's Chief Executive Officer. With me today are Tom Etergino, our Executive Vice President and Chief Financial Officer; and Greg Barton, our Executive Vice President of Business and Legal Affairs and General Counsel. This is Tom's first earnings call with our company as he started in early September. We are extremely pleased to have him augment our team with such a strong hire and I am sure you, the investors, will enjoy interacting with him.

Before we start, I’ll hand the call to Greg who will read our legal statement.

Greg Barton

Thanks Daryl. Welcome, everyone. All statements made on this call other than statements of historical facts are deemed to be forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995.

Such forward-looking statements are subject to risks and uncertainties including those described in the company’s filings with the Securities and Exchange Commission that could cause actual results to differ materially from those reflected in the forward-looking statements.

Although the company believes that the expectations reflected in the forward-looking statements are reasonable, the company cannot guarantee future results or occurrences. The company disclaims any obligation to update these forward-looking statements, whether as a result of new information, future developments, or otherwise. You may obtain copies of the company's filings with the SEC at the commission's website, And additional information related to matters discussed today also will be set forth on the company's quarterly report on Form 10-Q for the third quarter of 2010, which we expect to file shortly.

And now I will hand the call back to Daryl.

Daryl Otte

Thanks Greg. I think it will be useful to begin this call with an overview of markets conditions we saw in the quarter that are relevant to our business. The markets were somewhat unkind to our sector this past quarter where the Flash Crash of May 6 appears to have unfavorably affected the behavior of retail investors and consequently the businesses of our major advertising and marketing partners.

You all maybe familiar with some of the statistics, but as a reminder many brokerages reported that the retail trading volume declined in the range of 30% year-over-year and the Investment Company Institute reported that equity mutual funds saw net cash outflow to almost 40 billion during the quarter as compared to net cash inflows of 3 billion in the year-ago period.

As you might imaging as well, interest in the financial markets coverage also declined. Two independent measures of this interest, Nielsen and the Google Investing Index, which tracks queries related to investing terms such as stock, bonds

and ETFs, each showed a double-digit decline during the quarter as compared to a year ago.

In a word, our business faced some substantial market level headwinds in the quarter, while all these areas we could do better, I believe we did a good job of navigating through this empowerment and then our results reflect the benefits and efforts we have been undertaking in the last six quarters I’ve been here to refocus company. Indeed by most measures, our results moved contrary to the market trends.

But before moving onto the quarter results, I think it would be useful to recap the progress the company has made and to reiterate our strategic vision. First, one of the most important areas of my focus is then to recruiting new and outstanding management team and I am very pleased with the exceptional executives who have joined or been promoted from within the company in the past several quarters. This is now a team whose strength extends beyond that which we’d expect company of our current size to have.

Next we needed to put behind us the distractions of the restatement and divestitures. Having done so I felt we were in a position to move forward, move to a forward-leaning and we commenced our investment program to support our strategic plan to build long-term profitable growth and value. The strategic plan rest only on the proven and possible business model of vertical publishing and we are working hard to apply this model against our key assets. That is our market condition and brands which we are lucky to have and which are firmly situated around finance and which we believe to be among the highest value verticals in the media landscape.

As a remainder of our strategic plans, we believe in original content produced through high journalistic standards, with deep domain experience and overlaid with strong, well publishing skills. To that end, we are producing over 3000 original articles per month, 500 videos a month and a growing suite of data tools and utilities. All these content is produced by our professional in-house editorial team and through a select group of hand chosen practicing professionals.

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