Press Releases

Press Releases

RetailMeNot Announces Third Quarter 2015 Financial Results

- In-Store + Advertising Net Revenues grew 91% over the prior year period

- Mobile Online Transaction Net Revenues grew 55% over the prior year period

- GAAP EPS of $0.01; non-GAAP EPS of $0.12

- Adjusted EBITDA of $11.8 million; adjusted EBITDA margins of 23%

Nov 3, 2015

AUSTIN, Texas, Nov. 3, 2015 /PRNewswire/ -- RetailMeNot, Inc. (NASDAQ: SALE), the operator of the world's largest marketplace for digital offers, today announced its financial results for the third quarter ended September 30, 2015.

RetailMeNot, Inc.

Third Quarter Financial Results Highlights and Key Operating Metrics

(All comparisons are made to the third quarter of 2014 unless otherwise noted.  Amounts may not compute due to rounding)

  • Total net revenues declined 7% to $52.4 million.
    • In-store + advertising net revenues increased 91% to $11.8 million, representing 22% of total net revenues.
    • Mobile online transaction net revenues increased 55% to $4.9 million, representing 9% of total net revenues.
    • Desktop online transaction net revenues, which includes tablet, declined 24%, to $35.8 million, representing 68% of total net revenues.
  • Net revenues from international markets were $11.4 million, representing 22% of total net revenues.
  • GAAP net income was $0.3 million, compared to GAAP net income of $2.5 million.
  • Non-GAAP net income was $6.3 million, compared to non-GAAP net income of $9.1 million.
  • EPS was $0.01 per share, based on 53.7 million fully-diluted, weighted-average shares outstanding.
  • Non-GAAP EPS was $0.12 per share, based on 53.7 million fully-diluted, weighted-average shares outstanding.
  • Adjusted EBITDA was $11.8 million, compared to $16.7 million and representing 23% of total net revenues.
  • Total visits were 159.7 million, down 1%.
    • Mobile visits in the quarter increased 41% to 67.2 million, or 42% of total visits.
    • Desktop visits in the quarter declined 19% to 92.5 million.
  • Mobile unique visitors grew 28% totaling 18.6 million.

"I'm pleased with our performance on mobile online transaction and in-store and advertising net revenues, and adjusted EBITDA during the third quarter," said Cotter Cunningham, CEO & Founder, RetailMeNot, Inc.  "We believe our large and engaged audience coupled with our differentiated content types will position us well for future success, both online and in-store."

Business Outlook

Fourth Quarter 2015

  • Total net revenues are expected to be in the range of $74.0 to $76.0 million, or a decline of 14% at the mid-point.
  • Adjusted EBITDA is expected to be in the range of $25.0 to $27.0 million, or adjusted EBITDA margins of 35% at the mid-point.

Full Year 2015

The company is raising its previously issued guidance for the full year as follows:

  • Total net revenues are expected to be in the range of $240.0 to $242.0 million, or a decline of 9% at the mid-point.
  • Adjusted EBITDA is expected to be in the range of $66.0 to $68.0 million, or adjusted EBITDA margins of 28% at the mid-point.

The above statements are based on current expectations and actual results may differ materially as explained in "Forward-looking Statements" below.  Information about RetailMeNot's use of non-GAAP financial measures is provided below under the caption "Use of Non-GAAP Financial Measures".

Quarterly Conference Call

RetailMeNot will host a webcast to discuss its third quarter 2015 financial results and business outlook today at 7:00 a.m. Central Time (8:00 a.m. Eastern Time). 

A live webcast of the conference call can be accessed within the investor relations section of the RetailMeNot website at http://investor.retailmenot.com.  This webcast will contain forward-looking statements and other material information regarding the company's financial and operating results. Additionally, in advance of the conference call, RetailMeNot will post third quarter 2015 Management Commentary that can be accessed via the link above. 

Following completion of the call, a replay of the call will be available beginning at 9:30 a.m. Eastern Time on November 3, 2015 through February 5, 2015 at 11:59 p.m. Eastern Time.  To listen to the telephone replay, call (877) 344-7529 within the US, or (412) 317-0088 if calling internationally.  Access Code 10072357. 

About RetailMeNot, Inc. 

RetailMeNot, Inc. (http://www.retailmenot.com/corp/) operates the world's largest marketplace for digital offers. The company enables consumers across the globe to find hundreds of thousands of digital offers for their favorite retailers and brands. During the 12 months ended September 30, 2015, RetailMeNot, Inc. experienced nearly 730 million visits to its websites, and during the three months ended September 30, 2015, RetailMeNot, Inc. averaged 18.6 million mobile unique visitors per month.  In 2014, RetailMeNot, Inc. estimates $4.4 billion in paid retailer sales were attributable to consumer traffic from digital offers in its marketplace. The RetailMeNot, Inc. portfolio includes RetailMeNot.com, the largest digital offer marketplace in the United States; RetailMeNot.ca in Canada; VoucherCodes.co.uk, the largest digital offers marketplace in the United Kingdom; deals.com in Germany; Actiepagina.nl, a leading digital offers site in the Netherlands; ma-reduc.com, a leading digital offer site in France; Poulpeo.com, a leading digital offers site with cash back in France; and Deals2Buy.com, a digital offers site in North America. RetailMeNot, Inc. is listed on the NASDAQ stock exchange under the ticker symbol "SALE." Investors interested in learning more about the company can visit http://investor.retailmenot.com.

Key Operating Metrics

Visits. RetailMeNot defines a visit as a group of interactions that take place on one of RetailMeNot Inc.'s websites from computers, smartphones, tablets or other mobile devices within a given time frame as measured by Google Analytics, a product that provides digital marketing intelligence. A single visit can contain multiple page views, events, social interactions and e-commerce transactions. A single visitor can open multiple visits. Visits can occur on the same day, or over several days, weeks or months. As soon as one visit ends, there is then an opportunity to start a new visit. A visit ends either through the passage of time or a campaign change, with a campaign generally meaning arrival via search engine, referring site or campaign-tagged information. A visit ends through passage of time either after 30 minutes of inactivity or at midnight Pacific Time. A visit ends through a campaign change if a visitor arrives via one campaign or source, leaves the site, and then returns via another campaign or source.  Visits for the period do not include interactions through our mobile applications.

Mobile Unique Visitors.  This amount represents the average number of mobile unique visitors per month for the three month period ending September 30, 2015.  RetailMeNot counts each of the following as a mobile unique visitor: (i) the first time a specific mobile device accesses one of our mobile applications during a calendar month, and (ii) the first time a specific mobile device accesses one of our mobile websites using a specific web browser during a calendar month. If a mobile device accesses more than one of our mobile websites or mobile applications in a single calendar month, the first access to each such mobile website or mobile application is counted as a mobile unique visitor as they are tracked separately for each mobile domain. We measure mobile unique visitors with a combination of internal data sources and Google Analytics data.

Use of Non-GAAP Financial Measures

To provide investors with additional information regarding our financial results, this document includes references to Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP net income (loss) per share, all of which are non-GAAP financial measures.  For a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures, see the tables provided below in this release.

RetailMeNot defines adjusted EBITDA as net income (loss) plus depreciation, amortization of intangible assets, stock-based compensation expense, third-party acquisition-related costs, other non-cash operating expenses (including compensation arrangements entered into in connection with acquisitions), net interest expense, other non-operating income or expense (including net foreign exchange gains and losses) and income taxes.

RetailMeNot discloses adjusted EBITDA because it is a key measure used by RetailMeNot and its board of directors to understand and evaluate RetailMeNot's financial and operating performance, establish budgets and operational goals and as an element in determining executive compensation.  RetailMeNot believes adjusted EBITDA also facilitates period-to-period comparisons of operations that could otherwise be masked by the effect of the expenses that RetailMeNot excludes in this non-GAAP financial measure and facilitates comparisons with other peer companies, many of which use similar non-GAAP financial measures to supplement their GAAP results. 

Our presentation of non-GAAP net income (loss) and non-GAAP net income (loss) per share excludes the impact of amortization of purchased intangible assets, stock-based compensation expense, third party acquisition-related costs, other non-cash operating expenses (including compensation arrangements entered into in connection with acquisitions) and income taxes, net of the tax effect of the adjustments above.  These measures are not key metrics used by RetailMeNot or its board of directors to measure financial or operating performance or otherwise manage the business. However, RetailMeNot provides non-GAAP net income (loss) and non-GAAP net income (loss) per share as supplemental information for investors, as they facilitate period-to-period comparisons of operations that could otherwise be masked by the effect of the expenses that RetailMeNot excludes in these non-GAAP financial measures and facilitates comparisons with other peer companies, many of which use similar non-GAAP financial measures to supplement their GAAP results. 

Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP net income (loss) per share have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of RetailMeNot's results as reported under GAAP. Because of these limitations, you should consider Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP net income (loss) per share alongside other financial performance measures, including various cash flow metrics, net income (loss) and RetailMeNot's other GAAP results.

Forward-looking Statements               

This release contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, included herein regarding RetailMeNot's strategy, future operations, future financial position, future net revenues, projected costs, prospects, plans and objectives of management are forward-looking statements. The words "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "seek," "should," "target," "will," "would" and similar expressions (or the negative of these terms) are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements include, among other things, statements about management's estimates regarding future net revenues, adjusted EBITDA and other financial performance, visits, mobile unique visitors, e-mail subscribers, other consumer engagement metrics, new product and content offerings and other statements about management's beliefs, intentions or goals. RetailMeNot may not actually achieve the expectations disclosed in the forward-looking statements, and you should not place undue reliance on RetailMeNot's forward-looking statements. These forward-looking statements involve risks and uncertainties that could cause actual results or events to differ materially from the expectations disclosed in the forward-looking statements, including, but not limited to, (1) RetailMeNot's ability to attract visitors to its websites from search engines; (2) RetailMeNot's ability to monetize digital offers available through its mobile solutions; (3) RetailMeNot's ability to attract and retain paid retailers and maintain its relationships with performance marketing networks; (4) risks related to RetailMeNot's ability to manage the growth and complexity of its business, including accurately planning and forecasting its financial results; (5) RetailMeNot's ability to obtain and maintain digital offer content and maintain the positive perception of its brand; (6) the competitive environment for RetailMeNot's business; (7) changes in consumer sentiment regarding RetailMeNot's use of cookies; (8) RetailMeNot's need to manage regulatory, tax and litigation risks, including regulations imposing sales tax on e-commerce or m-commerce and ongoing litigation; (9) RetailMeNot's ability to use and protect consumer data and to protect its intellectual property; (10) RetailMeNot's ability to manage international business uncertainties; (11) the impact and integration of future acquisitions; and (12) other risks and potential factors that could affect RetailMeNot's business and financial results identified in RetailMeNot's filings with the Securities and Exchange Commission (the "SEC"), including its quarterly report on Form 10-Q filed with the SEC on August 7, 2015.  Additional information will also be set forth in RetailMeNot's future quarterly reports on Form 10-Q, annual reports on Form 10-K and other filings that RetailMeNot makes with the SEC. RetailMeNot does not intend or undertake any duty to release publicly any updates or revisions to any forward-looking statements contained herein.

Investor Contact
Michael Magaro
RetailMeNot, Inc.
mmagaro@rmn.com
(512) 777-2899

Media Contact
Brian Hoyt
RetailMeNot, Inc.
bhoyt@rmn.com
(512) 777-2957

 

RetailMeNot, Inc.




Condensed Consolidated Statements of Operations




(Unaudited, in thousands, except per share data)













Three Months Ended September 30,


Nine Months Ended September 30,


2015


2014


2015


2014









Net revenues

$52,412


$56,470


$165,976


$177,246

Costs and expenses:








Cost of net revenues (1)

4,511


4,598


15,033


13,676

Product development (1)

13,011


12,310


39,403


35,996

Sales and marketing (1)

21,930


19,198


66,207


59,565

General and administrative (1)

9,625


10,915


28,907


30,553

Amortization of purchased intangible assets

2,811


2,923


8,176


9,560

Other operating expenses

754


750


2,282


3,210

Total costs and expenses

52,642


50,694


160,008


152,560

Income from operations

(230)


5,776


5,968


24,686









Other income (expense):








Interest expense, net

(536)


(374)


(1,449)


(1,399)

Other income (expense), net

96


(674)


(301)


(974)









Income (loss) before income taxes

(670)


4,728


4,218


22,313

Benefit from (provision for) income taxes

1,013


(2,200)


(1,407)


(9,384)









Net income

343


2,528


2,811


12,929









Net income per share:








 Basic 

$0.01


$0.05


$0.05


$0.24

 Diluted 

$0.01


$0.05


$0.05


$0.23









Weighted average number of shares used in computing net income per share:








 Basic 

53,037


53,999


53,513


53,668

 Diluted 

53,744


55,086


54,581


55,366

















RetailMeNot, Inc.




Condensed Consolidated Statements of Operations (continued)




(Unaudited, in thousands)













Three Months Ended September 30,


Nine Months Ended September 30,


2015


2014


2015


2014

 (1)  Includes stock-based compensation as follows: 








Cost of net revenues

$524


$496


$1,643


$1,307

Product development

2,134


1,939


6,467


5,159

Sales and marketing

1,709


1,305


4,656


4,019

General and administrative

2,367


2,588


7,325


7,223

 Total 

$6,734


$6,328


$20,091


$17,708

 

RetailMeNot, Inc.




Reconciliation of Adjusted EBITDA




(Unaudited, in thousands)













Three Months Ended September 30,


Nine Months Ended September 30,


2015


2014


2015


2014









 Net income 

$         343


$     2,528


$       2,811


$    12,929

 Depreciation and amortization 

4,563


3,869


12,742


12,159

 Stock-based compensation expense 

6,734


6,328


20,091


17,708

 Third party acquisition-related costs 

-


-


55


-

 Other operating expenses 

754


750


2,282


3,210

 Interest expense, net 

536


374


1,449


1,399

 Other (income) expense, net 

(96)


674


301


974

 (Benefit from) provision for income taxes 

(1,013)


2,200


1,407


9,384









 Adjusted EBITDA 

$   11,821


$   16,723


$    41,138


$    57,763

























RetailMeNot, Inc.




Reconciliation of Non-GAAP Net Income and  Non-GAAP Diluted EPS




(Unaudited, in thousands, except per share data and percentages)





















Three Months Ended September 30,


Nine Months Ended September 30,


2015


2014


2015


2014

GAAP Income (loss) before income taxes

(670)


4,728


4,218


22,313

GAAP benefit from (provision for) income taxes

1,013


(2,200)


(1,407)


(9,384)

GAAP Net income

$         343


$     2,528


$       2,811


$    12,929

Non-GAAP adjustments to net income:








 Amortization of purchased intangibles 

2,811


2,923


8,176


9,560

 Stock-based compensation expense 

6,734


6,328


20,091


17,708

 Third party acquisition-related costs 

-


-


55


-

 Other operating expenses 

754


750


2,282


3,210

 Less: Tax effect of adjustments above 

(4,314)


(3,478)


(11,325)


(10,131)

 Total non-GAAP net income 

$      6,328


$      9,051


$     22,090


$     33,276









Diluted net income per share








GAAP  

$        0.01


$        0.05


$         0.05


$         0.23

Non-GAAP

$        0.12


$        0.16


$         0.40


$         0.60









Shares used in non-GAAP diluted EPS calculation:








Weighted-average shares outstanding used in calculating GAAP diluted EPS

53,744


55,086


54,581


55,366

Additional dilutive securities for non-GAAP diluted EPS

-


-


-


-

Weighted-average shares outstanding used in calculating non-GAAP diluted EPS

53,744


55,086


54,581


55,366









Reconciliation of non-GAAP effective tax rate:








GAAP Effective tax rate

151.2%


46.5%


33.4%


42.1%

Tax effect of non-GAAP adjustments to net income

(116.9%)


(8.0%)


3.2%


(5.1%)

Non-GAAP effective tax rate

34.3%


38.5%


36.6%


37.0%

 

RetailMeNot, Inc.

Condensed Consolidated Balance Sheets

(Unaudited, in thousands)


 As of September 30, 


 As of December 31, 


2015


2014

 Assets 




 Current assets: 




 Cash and cash equivalents 

$                                270,705


$                             244,482

 Accounts receivable, net 

40,716


69,603

 Prepaids and other current assets, net 

17,181


14,930

 Total current assets 

328,602


329,015





 Property and equipment, net 

21,151


16,949

 Intangible assets, net 

66,255


70,819

 Goodwill 

175,271


176,927

 Other assets, net 

8,880


5,394

 Total assets 

$                                600,159


$                             599,104





 Liabilities and Stockholders' Equity 




 Current liabilities: 




 Accounts payable 

$                                    3,903


$                                 5,482

 Accrued compensation and benefits 

8,422


12,138

 Accrued expenses and other current liabilities 

7,763


6,110

 Income taxes payable 

1,377


9,032

 Current maturities of long term debt 

10,000


10,000

 Total current liabilities 

31,465


42,762





 Deferred tax liability--noncurrent 

5,063


3,404

 Long term debt 

65,000


40,000

 Other noncurrent liabilities 

8,297


8,183

 Total liabilities 

109,825


94,349





 Stockholders' equity (deficit): 




 Common stock 

52


54

 Additional paid-in capital 

502,232


517,421

 Accumulated other comprehensive loss 

(3,984)


(1,942)

 Accumulated deficit 

(7,966)


(10,778)

 Total stockholders' equity 

490,334


504,755

 Total liabilities and stockholders' equity 

$                                600,159


$                             599,104

 

 

RetailMeNot, Inc.




Condensed Consolidated Statements of Cash Flows




(Unaudited, in thousands)













Three Months Ended September 30,


Nine Months Ended September 30,


2015


2014


2015


2014

 Cash flows from operating activities: 








Net income

$343


$2,528


$2,811


$12,929

 Adjustments to reconcile net income to cash provided by
 operating activities: 








    Depreciation and amortization expense

4,563


3,869


12,742


12,159

    Stock based compensation expense

6,734


6,328


20,091


17,708

    Excess income tax benefit from stock-based compensation and other

(26)


(1,481)


(1,333)


(12,004)

    Deferred income tax expense (benefit) 

(44)


(1,008)


238


(2,796)

    Non-cash interest expense

102


97


305


290

    Amortization of deferred compensation

761


751


2,297


3,210

    Other non-cash (gains) losses, net

(183)


579


969


942

    Provision for doubtful accounts receivable

203


1,145


(84)


1,967

Changes in operating assets and liabilities:








  Accounts receivable, net

(2,719)


(2,230)


28,242


14,557

  Prepaid expenses and other current assets, net

(3,216)


1,723


(4,946)


416

  Accounts payable

(2,002)


1,231


(846)


(735)

  Accrued expenses and other current liabilities

2,100


1,294


(10,061)


2,245

  Other noncurrent assets and liabilities

1,001


271


1,833


676

 Net cash provided by operating activities 

$7,617


15,097


$52,258


51,564

 Cash flows from investing activities: 








    Payments for acquisition of businesses, net of acquired cash

-


-


-


(75)

    Proceeds from sale of property and equipment

9


-


14


-

    Purchase of other assets

-


(3,285)


(4,302)


(3,386)

    Purchase of non-marketable investment

-


-


(4,000)


-

    Purchase of property and equipment

(2,418)


(3,395)


(8,741)


(6,854)

 Net cash used in investing activities 

(2,409)


(6,680)


(17,029)


(10,315)

 Cash flows from financing activities: 








    Proceeds from notes payable, net of issuance costs

-


-


29,950


-

    Payments on notes payable

(2,500)


(8,023)


(5,000)


(13,273)

    Proceeds from public offerings, net of offering costs

-


-


-


(61)

    Excess income tax benefit from stock-based compensation and other

26


1,481


1,333


12,004

    Payments of principal on capital lease arrangements

-


(1)


(7)


(7)

    Payments for repurchase of common stock

(11,616)


-


(38,808)


(6)

    Proceeds from issuance of common stock, net of shares withheld for taxes

(136)


830


4,330


10,627

 Net cash provided by (used in) financing activities 

(14,226)


(5,713)


(8,202)


9,284

 Effect of foreign currency exchange rate on cash 

(94)


(915)


(804)


(720)

 Change in cash and cash equivalents 

(9,112)


1,789


26,223


49,813

  Cash and cash equivalents, beginning of period 

279,817


213,905


244,482


165,881









  Cash and cash equivalents, end of period 

$270,705


$215,694


$270,705


$215,694

-- RMNSALE-F –

Logo - http://photos.prnewswire.com/prnh/20130626/DA38415LOGO

 

SOURCE RetailMeNot, Inc.


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