CHARLOTTE, N.C., Feb. 23, 2017 /PRNewswire/
-- LendingTree, Inc. (NASDAQ: TREE), operator of
LendingTree.com, the nation's leading online loan marketplace,
today announced results for the quarter and fiscal year ended
December 31, 2016.
"Simply stated, the company's fourth quarter results exceeded
our expectations and capped off another terrific year at
LendingTree," said Doug Lebda,
Chairman and CEO. "Throughout 2016 our team excelled at managing
the business through a multitude of headwinds affecting several of
our largest categories. Not only did we deliver outstanding
financial results, growing revenue 51% and adjusted EBITDA by 71%,
our accomplishments in the fourth quarter and throughout the year
are fully aligned with our long-term strategy. We
strengthened our foundation and are well-positioned for continued
growth as we head into 2017 and beyond. The company is
already off to a solid start this year as we're laser-focused on
executing against the strategic initiatives laid out in
December."
Gabe Dalporto, Chief Financial
Officer added, "At our Investor Day in December, we updated you on
Q4, established guidance for 2017 and provided longer term goals
and targets for LendingTree. Today, we are pleased to report
that we are tracking very well toward all of our goals.
Despite the typical seasonal headwinds in the fourth quarter, we
notched record levels of revenue, variable marketing margin and
adjusted EBITDA. Our mortgage business returned to sequential
revenue growth in the quarter and is behaving as expected as
interest rates have risen. And our acquisition of
CompareCards in November gives us the scale to compete and gain
market share in the largest category for online comparison shopping
in financial services."
Fourth Quarter 2016 Business Highlights
- Total loan requests in the quarter of 4.1 million grew 57%
compared to fourth quarter 2015
- Revenue from mortgage products of $55.4
million represents an increase of 18% over fourth quarter
2015 and reflects 4% sequential growth during what is typically a
seasonally challenging quarter.
- Record revenue from non-mortgage products of $45.4 million in the fourth quarter represents an
increase of 45% over the fourth quarter 2015 and comprised 45% of
total revenue.
- Including impact from the acquisition of CompareCards on
November 16, 2016, revenue from our
credit card offerings grew to $16.0
million, an increase of 145% compared to fourth quarter
2015
- Home equity revenue grew 134% over fourth quarter 2015 and
marked its eight consecutive quarter of sequential growth.
- More than 4.3 million consumers have now signed up for free
credit scores and savings alerts through My LendingTree, and the
revenue contribution from My LendingTree achieved record levels in
the month of January.
LendingTree
Selected Financial Metrics
|
(In millions,
except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q/Q
|
|
|
|
|
Y/Y
|
|
|
4Q
2016
|
|
3Q
2016
|
|
%
Change
|
|
|
4Q
2015
|
|
%
Change
|
|
Revenue by
Product
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage Products
(1)
|
$
|
55.4
|
|
|
$
|
53.5
|
|
|
4
|
%
|
|
|
$
|
46.9
|
|
|
18
|
%
|
|
Non-Mortgage Products
(2)
|
45.4
|
|
|
41.1
|
|
|
10
|
%
|
|
|
31.4
|
|
|
45
|
%
|
|
Total
Revenue
|
$
|
100.8
|
|
|
$
|
94.6
|
|
|
7
|
%
|
|
|
$
|
78.3
|
|
|
29
|
%
|
|
Non-Mortgage % of
Total
|
45
|
%
|
|
43
|
%
|
|
|
|
|
40
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Before Income
Taxes
|
$
|
13.3
|
|
|
$
|
14.0
|
|
|
(5)
|
%
|
|
|
$
|
8.1
|
|
|
64
|
%
|
|
Income Tax (Expense)
Benefit
|
$
|
(5.3)
|
|
|
$
|
(6.7)
|
|
|
|
|
|
$
|
24.0
|
|
|
|
|
Net Income from
Continuing Operations
|
$
|
8.0
|
|
|
$
|
7.3
|
|
|
10
|
%
|
|
|
$
|
32.1
|
|
|
(75)
|
%
|
|
Net Income from
Cont. Ops. % of Revenue
|
8
|
%
|
|
8
|
%
|
|
|
|
|
41
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income per
Share from Cont. Ops.
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.68
|
|
|
$
|
0.62
|
|
|
10
|
%
|
|
|
$
|
2.69
|
|
|
(75)
|
%
|
|
Diluted
|
$
|
0.63
|
|
|
$
|
0.57
|
|
|
11
|
%
|
|
|
$
|
2.47
|
|
|
(74)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling and
Marketing Expense
|
|
|
|
|
|
|
|
|
|
|
|
Variable Selling
& Marketing Expense (3)
|
$
|
64.1
|
|
|
$
|
58.2
|
|
|
10
|
%
|
|
|
$
|
50.3
|
|
|
27
|
%
|
|
Non-variable Selling
& Marketing
|
4.6
|
|
|
4.6
|
|
|
—
|
%
|
|
|
3.9
|
|
|
18
|
%
|
|
Selling and
Marketing Expense
|
$
|
68.7
|
|
|
$
|
62.8
|
|
|
9
|
%
|
|
|
$
|
54.2
|
|
|
27
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Variable Marketing
Margin (4)
|
$
|
36.8
|
|
|
$
|
36.3
|
|
|
1
|
%
|
|
|
$
|
28.0
|
|
|
31
|
%
|
|
Variable Marketing
Margin % of Revenue
|
36
|
%
|
|
38
|
%
|
|
|
|
|
36
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(4)
|
$
|
18.9
|
|
|
$
|
18.5
|
|
|
2
|
%
|
|
|
$
|
12.0
|
|
|
58
|
%
|
|
Adjusted EBITDA %
of Revenue (4)
|
19
|
%
|
|
20
|
%
|
|
|
|
|
15
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net
Income (4)
|
$
|
11.0
|
|
|
$
|
10.1
|
|
|
9
|
%
|
|
|
$
|
34.9
|
|
|
(68)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net
Income per Share (4)
|
$
|
0.87
|
|
|
$
|
0.80
|
|
|
9
|
%
|
|
|
$
|
2.69
|
|
|
(68)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Includes the purchase
mortgage and refinance mortgage products.
|
(2)
|
Includes the home
equity, reverse mortgage, personal loan, credit card, small
business loan, student loan, auto loan, home services, insurance
and personal credit products.
|
(3)
|
Defined as the
portion of selling and marketing expense attributable to variable
costs paid for advertising, direct marketing and related expenses,
which excludes overhead, fixed costs and personnel-related
expenses.
|
(4)
|
Variable Marketing
Margin, Variable Marketing Margin % of Revenue, Adjusted EBITDA,
Adjusted EBITDA % of revenue, Adjusted Net Income and Adjusted Net
Income per Share are non-GAAP measures. Please see
"LendingTree's Reconciliation of Non-GAAP Measures to GAAP" and
"LendingTree's Principles of Financial Reporting" below for more
information.
|
Fourth Quarter 2016 Financial Highlights
- Record consolidated revenue of $100.8
million represents an increase of $22.5 million, or 29%, over revenue in the fourth
quarter 2015.
- GAAP Net Income from Continuing Operations of $8.0 million, or $0.63 per diluted share.
- Record Variable Marketing Margin of $36.8 million represents an increase of
$8.7 million, or 31%, over fourth
quarter 2015.
- Record Adjusted EBITDA of $18.9
million increased $6.9
million, or 58%, over fourth quarter 2015.
- Adjusted Net Income per share of $0.87.
Full-Year 2016 Financial Highlights
- Record consolidated revenue of $384.4
million represents an increase of $130.2 million, or 51%, over revenue in full-year
2015.
- Net Income from Continuing Operations of $31.2 million, or $2.44 per diluted share.
- Record Variable Marketing Margin of $141.2 million represents an increase of
$46.2 million, or 49%, over full-year
2015.
- Record Adjusted EBITDA of $69.8
million increased $29.0
million, or 71%, over full-year 2015.
- Adjusted Net Income per share of $3.34.
Business Outlook - 2017
LendingTree is providing Revenue, Variable Marketing Margin and
Adjusted EBITDA guidance for first quarter 2017 and reiterating
full-year 2017 guidance, as follows:
For first quarter 2017:
- Revenue is anticipated to be $122 - $126
million, or 29% - 33% over first quarter 2016.
- Variable Marketing Margin is anticipated to be in the range of
$41 - $43 million.
- Adjusted EBITDA is anticipated to be in the range of
$20.5 - $22.0 million, implying
year-over-year growth of 30% - 39%.
For full-year 2017:
- Revenue is anticipated to be in the range of $500 - $520 million, or 30% - 35% over full-year
2016.
- Variable Marketing Margin is anticipated to be $175 - $185 million, or 24% - 31% over full-year
2016.
- Adjusted EBITDA is anticipated to be in the range of
$93 - $97 million, or 33% - 39%
compared to full-year 2016.
LendingTree is not able to provide a reconciliation of projected
Variable Marketing Margin or Adjusted EBITDA to the most directly
comparable expected GAAP results due to the unknown effect, timing
and potential significance of the effects of legal matters and tax
considerations. Expenses associated with legal matters and
tax consequences have in the past, and may in the future,
significantly affect GAAP results in a particular period.
Quarterly Conference Call
A conference call to discuss LendingTree's fourth quarter 2016
financial results will be webcast live today, February 23, 2017 at 9:00
AM Eastern Time (ET). The live audiocast is open to the
public and will be available on LendingTree's investor relations
website at http://investors.lendingtree.com/. The call may also be
accessed toll-free via phone at (877) 606-1416. Callers outside
the United States and Canada may dial (707) 287-9313. Following
completion of the call, a recorded replay of the webcast will be
available on LendingTree's investor relations website until
12:00 PM ET on Thursday, March 2, 2017. To listen to the
telephone replay, call toll-free (855) 859-2056 with passcode
#59575909. Callers outside the United
States and Canada may dial
(404) 537-3406 with passcode #59575909.
LENDINGTREE, INC. AND
SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(Unaudited)
|
|
|
Three Months Ended
December 31,
|
|
Twelve Months
Ended December 31,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
(in thousands, except per share amounts)
|
Revenue
|
$
|
100,841
|
|
|
$
|
78,341
|
|
|
$
|
384,402
|
|
|
$
|
254,216
|
|
Costs and
expenses:
|
|
|
|
|
|
|
|
Cost of revenue
(exclusive of depreciation and amortization) (1)
|
3,435
|
|
|
2,968
|
|
|
13,764
|
|
|
9,370
|
|
Selling and marketing
expense (1)
|
68,684
|
|
|
54,234
|
|
|
261,100
|
|
|
172,849
|
|
General and
administrative expense (1)
|
10,407
|
|
|
8,694
|
|
|
37,227
|
|
|
30,030
|
|
Product development
(1)
|
2,377
|
|
|
3,247
|
|
|
13,761
|
|
|
10,485
|
|
Depreciation
|
1,486
|
|
|
873
|
|
|
4,944
|
|
|
3,008
|
|
Amortization of
intangibles
|
980
|
|
|
25
|
|
|
1,243
|
|
|
149
|
|
Restructuring and
severance
|
50
|
|
|
—
|
|
|
122
|
|
|
422
|
|
Litigation
settlements and contingencies
|
20
|
|
|
52
|
|
|
129
|
|
|
(611)
|
|
Total costs and
expenses
|
87,439
|
|
|
70,093
|
|
|
332,290
|
|
|
225,702
|
|
Operating
income
|
13,402
|
|
|
8,248
|
|
|
52,112
|
|
|
28,514
|
|
Other income
(expense), net:
|
|
|
|
|
|
|
|
Interest expense,
net
|
(137)
|
|
|
(108)
|
|
|
(561)
|
|
|
(171)
|
|
Other
income
|
23
|
|
|
—
|
|
|
23
|
|
|
—
|
|
Income before
income taxes
|
13,288
|
|
|
8,140
|
|
|
51,574
|
|
|
28,343
|
|
Income tax (expense)
benefit
|
(5,267)
|
|
|
23,941
|
|
|
(20,366)
|
|
|
22,973
|
|
Net income from
continuing operations
|
8,021
|
|
|
32,081
|
|
|
31,208
|
|
|
51,316
|
|
Loss from
discontinued operations
|
(697)
|
|
|
(31)
|
|
|
(3,714)
|
|
|
(3,269)
|
|
Net income and
comprehensive income
|
$
|
7,324
|
|
|
$
|
32,050
|
|
|
$
|
27,494
|
|
|
$
|
48,047
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
11,767
|
|
|
11,926
|
|
|
11,812
|
|
|
11,516
|
|
Diluted
|
12,749
|
|
|
12,972
|
|
|
12,773
|
|
|
12,541
|
|
Income per share
from continuing operations:
|
|
|
|
|
|
|
|
Basic
|
$
|
0.68
|
|
|
$
|
2.69
|
|
|
$
|
2.64
|
|
|
$
|
4.46
|
|
Diluted
|
$
|
0.63
|
|
|
$
|
2.47
|
|
|
$
|
2.44
|
|
|
$
|
4.09
|
|
Loss per share
from discontinued operations:
|
|
|
|
|
|
|
|
Basic
|
$
|
(0.06)
|
|
|
$
|
—
|
|
|
$
|
(0.31)
|
|
|
$
|
(0.28)
|
|
Diluted
|
$
|
(0.05)
|
|
|
$
|
—
|
|
|
$
|
(0.29)
|
|
|
$
|
(0.26)
|
|
Net income per
share:
|
|
|
|
|
|
|
|
Basic
|
$
|
0.62
|
|
|
$
|
2.69
|
|
|
$
|
2.33
|
|
|
$
|
4.17
|
|
Diluted
|
$
|
0.57
|
|
|
$
|
2.47
|
|
|
$
|
2.15
|
|
|
$
|
3.83
|
|
(1) Amounts
include non-cash compensation, as follows:
|
|
|
|
|
|
|
|
Cost of
revenue
|
$
|
30
|
|
|
$
|
27
|
|
|
$
|
129
|
|
|
$
|
95
|
|
Selling and marketing
expense
|
604
|
|
|
517
|
|
|
2,722
|
|
|
1,597
|
|
General and
administrative expense
|
1,188
|
|
|
1,211
|
|
|
4,699
|
|
|
5,120
|
|
Product
development
|
415
|
|
|
382
|
|
|
2,097
|
|
|
1,558
|
|
LENDINGTREE, INC. AND
SUBSIDIARIES
|
CONSOLIDATED
BALANCE SHEETS
|
(Unaudited)
|
|
|
December 31,
2016
|
|
December 31,
2015
|
|
(in thousands, except par value and share
amounts)
|
ASSETS:
|
|
|
|
Cash and cash
equivalents
|
$
|
91,131
|
|
|
$
|
206,975
|
|
Restricted cash and
cash equivalents
|
4,089
|
|
|
6,541
|
|
Accounts receivable,
net
|
41,872
|
|
|
29,873
|
|
Prepaid and other
current assets
|
3,531
|
|
|
2,085
|
|
Current assets of
discontinued operations
|
—
|
|
|
110
|
|
Total current
assets
|
140,623
|
|
|
245,584
|
|
Property and
equipment, net
|
35,462
|
|
|
9,415
|
|
Goodwill
|
56,457
|
|
|
3,632
|
|
Intangible assets,
net
|
71,684
|
|
|
10,992
|
|
Deferred income tax
assets
|
17,043
|
|
|
20,977
|
|
Other non-current
assets
|
810
|
|
|
1,039
|
|
Non-current assets of
discontinued operations
|
3,781
|
|
|
4,142
|
|
Total
assets
|
$
|
325,860
|
|
|
$
|
295,781
|
|
|
|
|
|
LIABILITIES:
|
|
|
|
Accounts payable,
trade
|
$
|
5,593
|
|
|
$
|
5,741
|
|
Accrued expenses and
other current liabilities
|
49,403
|
|
|
34,885
|
|
Current liabilities
of discontinued operations
|
11,711
|
|
|
13,401
|
|
Total current
liabilities
|
66,707
|
|
|
54,027
|
|
Contingent
considerations
|
23,600
|
|
|
—
|
|
Other non-current
liabilities
|
1,685
|
|
|
586
|
|
Deferred income tax
liabilities
|
2,433
|
|
|
—
|
|
Non-current
liabilities of discontinued operations
|
—
|
|
|
26
|
|
Total
liabilities
|
94,425
|
|
|
54,639
|
|
SHAREHOLDERS'
EQUITY:
|
|
|
|
Preferred stock $.01
par value; 5,000,000 shares authorized; none issued or
outstanding
|
—
|
|
|
—
|
|
Common stock $.01 par
value; 50,000,000 shares authorized; 13,955,378 and 13,865,620
shares issued, respectively, and 11,791,633 and 12,392,093 shares
outstanding, respectively
|
140
|
|
|
139
|
|
Additional paid-in
capital
|
1,018,010
|
|
|
1,006,688
|
|
Accumulated
deficit
|
(722,630)
|
|
|
(750,124)
|
|
Treasury stock
2,163,745 and 1,473,527 shares, respectively
|
(64,085)
|
|
|
(15,561)
|
|
Total
shareholders' equity
|
231,435
|
|
|
241,142
|
|
Total liabilities
and shareholders' equity
|
$
|
325,860
|
|
|
$
|
295,781
|
|
LENDINGTREE'S
RECONCILIATION OF NON-GAAP MEASURES TO GAAP
|
|
Below is a
reconciliation of Variable Marketing Margin to net income from
continuing operations and Variable Marketing Margin % of revenue to
net income from continuing operations % of revenue. See
"LendingTree's Principles of Financial Reporting" for further
discussion of the Company's use of these non-GAAP
measures.
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
December 31,
2016
|
September 30,
2016
|
December 31,
2015
|
|
December 31,
2016
|
December 31,
2015
|
|
|
|
|
|
|
|
Variable Marketing
Margin
|
$
|
36,750
|
|
$
|
36,322
|
|
$
|
28,034
|
|
|
$
|
141,181
|
|
$
|
94,993
|
|
Variable Marketing
Margin % of revenue
|
36
|
%
|
38
|
%
|
36
|
%
|
|
37
|
%
|
37
|
%
|
|
|
|
|
|
|
|
Adjustments to
reconcile to net income from continuing operations:
|
|
|
|
|
|
|
Cost of
revenue
|
(3,435)
|
|
(3,392)
|
|
(2,968)
|
|
|
(13,764)
|
|
(9,370)
|
|
Non-variable selling
and marketing expense (1)
|
(4,593)
|
|
(4,583)
|
|
(3,927)
|
|
|
(17,879)
|
|
(13,626)
|
|
General and
administrative expense
|
(10,407)
|
|
(9,008)
|
|
(8,694)
|
|
|
(37,227)
|
|
(30,030)
|
|
Product
development
|
(2,377)
|
|
(3,718)
|
|
(3,247)
|
|
|
(13,761)
|
|
(10,485)
|
|
Depreciation
|
(1,486)
|
|
(1,286)
|
|
(873)
|
|
|
(4,944)
|
|
(3,008)
|
|
Amortization of
intangibles
|
(980)
|
|
(166)
|
|
(25)
|
|
|
(1,243)
|
|
(149)
|
|
Restructuring and
severance
|
(50)
|
|
—
|
|
—
|
|
|
(122)
|
|
(422)
|
|
Litigation
settlements and contingencies
|
(20)
|
|
(19)
|
|
(52)
|
|
|
(129)
|
|
611
|
|
Interest expense,
net
|
(137)
|
|
(141)
|
|
(108)
|
|
|
(561)
|
|
(171)
|
|
Other
income
|
23
|
|
—
|
|
—
|
|
|
23
|
|
—
|
|
Income tax (expense)
benefit
|
(5,267)
|
|
(6,729)
|
|
23,941
|
|
|
(20,366)
|
|
22,973
|
|
Net income from
continuing operations
|
$
|
8,021
|
|
$
|
7,280
|
|
$
|
32,081
|
|
|
$
|
31,208
|
|
$
|
51,316
|
|
Net income from
continuing operations % of revenue
|
8
|
%
|
8
|
%
|
41
|
%
|
|
8
|
%
|
20
|
%
|
|
|
|
(1)
|
Defined as the
portion of selling and marketing expense not attributable to
variable costs paid for advertising, direct marketing and related
expenses. Includes overhead, fixed costs and
personnel-related expenses.
|
Below is a
reconciliation of adjusted EBITDA and adjusted net income to net
income from continuing operations, adjusted EBITDA % of revenue to
net income from continuing operations % of revenue and adjusted net
income per share to net income per diluted share from continuing
operations. See "LendingTree's Principles of Financial
Reporting" for further discussion of the Company's use of these
non-GAAP measures.
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
December 31,
2016
|
September 30,
2016
|
December 31,
2015
|
|
December 31,
2016
|
December 31,
2015
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
|
18,910
|
|
$
|
18,452
|
|
$
|
11,981
|
|
|
$
|
69,819
|
|
$
|
40,818
|
|
Adjusted EBITDA %
of revenue
|
19
|
%
|
20
|
%
|
15
|
%
|
|
18
|
%
|
16
|
%
|
Adjustments to
reconcile to net income (loss) from continuing
operations:
|
|
|
|
|
|
|
Depreciation
|
(1,486)
|
|
(1,286)
|
|
(873)
|
|
|
(4,944)
|
|
(3,008)
|
|
Amortization of
intangibles
|
(980)
|
|
(166)
|
|
(25)
|
|
|
(1,243)
|
|
(149)
|
|
Interest expense,
net
|
(137)
|
|
(141)
|
|
(108)
|
|
|
(561)
|
|
(171)
|
|
Income tax (expense)
benefit
|
(5,267)
|
|
(6,729)
|
|
23,941
|
|
|
(20,366)
|
|
22,973
|
|
Adjusted net
income
|
11,040
|
|
10,130
|
|
34,916
|
|
|
42,705
|
|
60,463
|
|
|
|
|
|
|
|
|
Non-cash
compensation
|
(2,237)
|
|
(2,348)
|
|
(2,137)
|
|
|
(9,647)
|
|
(8,370)
|
|
Loss on disposal of
assets
|
(253)
|
|
(121)
|
|
(646)
|
|
|
(640)
|
|
(748)
|
|
Estimated settlement
for unclaimed property
|
—
|
|
—
|
|
—
|
|
|
—
|
|
(134)
|
|
Acquisition
expense
|
(459)
|
|
(362)
|
|
—
|
|
|
(959)
|
|
(84)
|
|
Restructuring and
severance
|
(50)
|
|
—
|
|
—
|
|
|
(122)
|
|
(422)
|
|
Litigation
settlements and contingencies (1)
|
(20)
|
|
(19)
|
|
(52)
|
|
|
(129)
|
|
611
|
|
Net income from
continuing operations
|
$
|
8,021
|
|
$
|
7,280
|
|
$
|
32,081
|
|
|
$
|
31,208
|
|
$
|
51,316
|
|
Net income from
continuing operations % of revenue
|
8
|
%
|
8
|
%
|
41
|
%
|
|
8
|
%
|
20
|
%
|
|
|
|
|
|
|
|
Adjusted net
income per share
|
$
|
0.87
|
|
$
|
0.80
|
|
$
|
2.69
|
|
|
$
|
3.34
|
|
$
|
4.82
|
|
Adjustments to
reconcile adjusted net income to net income from continuing
operations
|
$
|
(0.24)
|
|
$
|
(0.23)
|
|
$
|
(0.22)
|
|
|
$
|
(0.90)
|
|
$
|
(0.73)
|
|
Adjustments to
reconcile effect of dilutive securities
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
|
$
|
—
|
|
$
|
—
|
|
Net income per
diluted share from continuing operations
|
$
|
0.63
|
|
$
|
0.57
|
|
$
|
2.47
|
|
|
$
|
2.44
|
|
$
|
4.09
|
|
|
|
|
|
|
|
|
Adjusted weighted
average diluted shares outstanding
|
12,749
|
|
12,742
|
|
12,972
|
|
|
12,773
|
|
12,541
|
|
Effect of dilutive
securities
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
Weighted average
diluted shares outstanding
|
12,749
|
|
12,742
|
|
12,972
|
|
|
12,773
|
|
12,541
|
|
Effect of dilutive
securities
|
982
|
|
988
|
|
1,046
|
|
|
961
|
|
1,025
|
|
Weighted average
basic shares outstanding
|
11,767
|
|
11,754
|
|
11,926
|
|
|
11,812
|
|
11,516
|
|
|
|
(1)
|
Includes legal fees
for certain patent litigation.
|
LENDINGTREE'S PRINCIPLES OF FINANCIAL REPORTING
LendingTree reports the following non-GAAP measures as
supplemental to GAAP:
- Variable Marketing Margin
- Variable Marketing Margin % of revenue
- Earnings Before Interest, Taxes, Depreciation and Amortization,
as adjusted for certain items discussed below ("Adjusted
EBITDA")
- Adjusted EBITDA % of revenue
- Adjusted Net Income
- Adjusted Net Income per share
Variable Marketing Margin is a measure of the operating
efficiency of the Company's operating model, measuring revenue
after subtracting variable marketing costs that directly influence
revenue. The Company's operating model is highly sensitive to the
amount and efficiency of variable marketing expenditures, and the
Company's proprietary systems are able to make rapidly changing
decisions concerning the deployment of variable marketing
expenditures (primarily but not exclusively online and mobile
advertising placement) based on proprietary and sophisticated
analytics. Variable Marketing Margin and Variable Marketing
Margin % of revenue are primary metrics by which the Company
measure the effectiveness of its marketing efforts.
Adjusted EBITDA and Adjusted EBITDA % of revenue are primary
metrics by which LendingTree evaluates the operating performance of
its businesses, on which its marketing expenditures and internal
budgets are based and, in the case of Adjusted EBITDA, by which
management and many employees are compensated. LendingTree believes
that investors should have access to the same set of tools that it
uses in analyzing its results. LendingTree believes that Adjusted
Net Income and Adjusted Net Income per share are useful financial
indicators that provide a different view of the financial
performance of the Company than Adjusted EBITDA (the primary metric
by which LendingTree evaluates the operating performance of its
businesses) and the GAAP measures of net income from continuing
operations and GAAP income (loss) per diluted share.
Adjusted net income and Adjusted Net Income per share supplement
GAAP income from continuing operations and GAAP income (loss) per
diluted share by enabling investors to make period to period
comparisons of those components of the nearest comparable GAAP
measures that management believes better reflect the underlying
financial performance of the Company's business operations during
particular financial reporting periods. Adjusted net income and
Adjusted Net Income per share exclude certain amounts, such as
non-cash compensation, non-cash asset impairment charges, gain/loss
on disposal of assets, restructuring and severance, litigation
settlements, contingencies and legal fees for certain patent
litigation, and acquisition and disposition income or expenses
including with respect to fair value of contingent consideration,
and one time items which are recognized and recorded under GAAP in
particular periods but which might be viewed as not necessarily
coinciding with the underlying business operations for the periods
in which they are so recognized and recorded.
These non-GAAP measures should be considered in addition to
results prepared in accordance with GAAP, but should not be
considered a substitute for or superior to GAAP results.
LendingTree provides and encourages investors to examine the
reconciling adjustments between the GAAP and non-GAAP measures set
forth above.
Definition of LendingTree's Non-GAAP Measures
Variable Marketing Margin is defined as revenue less the portion
of selling & marketing expense attributable to variable costs
paid for advertising, direct marketing and related expenses, which
excludes overhead, fixed costs and personnel-related expenses.
EBITDA is defined as net income from continuing operations
excluding interest, income taxes, amortization of intangibles and
depreciation.
Adjusted EBITDA is defined as EBITDA excluding (1) non-cash
compensation expense, (2) non-cash impairment charges, (3)
gain/loss on disposal of assets, (4) restructuring and severance
expenses, (5) litigation settlements, contingencies and legal fees
for certain patent litigation, (6) acquisitions and dispositions
income or expense (including with respect to changes in fair value
of contingent consideration), and (7) one-time items.
Adjusted net income is defined as net income (loss) from
continuing operations excluding (1) non-cash compensation expense,
(2) non-cash impairment charges, (3) gain/loss on disposal of
assets, (4) restructuring and severance expenses, (5) litigation
settlements, contingencies and legal fees for certain patent
litigation, (6) acquisitions and dispositions income or expense
(including with respect to changes in fair value of contingent
consideration), and (7) one-time items.
Adjusted net income per share is defined as Adjusted Net Income
divided by the adjusted weighted average diluted shares
outstanding. In cases where the Company reported GAAP losses
from continuing operations, the effects of potentially dilutive
securities are excluded from the calculation of net loss per
diluted share from continuing operations because their inclusion
would have been anti-dilutive. In such instances where the
Company reports GAAP net loss from continuing operations but
reports positive non-GAAP Adjusted Net Income, the effects of
potentially dilutive securities are included in the denominator for
calculating Adjusted Net Income per share.
LendingTree endeavors to compensate for the limitations of these
non-GAAP measures by also providing the comparable GAAP measures
with equal or greater prominence and descriptions of the
reconciling items, including quantifying such items, to derive the
non-GAAP measures. These non-GAAP measures may not be
comparable to similarly titled measures used by other
companies.
One-Time Items
Adjusted EBITDA and Adjusted Net Income are adjusted for
one-time items, if applicable. Items are considered one-time in
nature if they are non-recurring, infrequent or unusual, and have
not occurred in the past two years or are not expected to recur in
the next two years, in accordance with SEC rules. For the periods
presented in this report, there are no adjustments for one-time
items except for an estimated settlement for unclaimed property in
2015.
Non-Cash Expenses That Are Excluded From LendingTree's
Adjusted EBITDA and Adjusted Net Income
Non-cash compensation expense consists principally of expense
associated with the grants of restricted stock, restricted stock
units and stock options. These expenses are not paid in cash and
LendingTree includes the related shares in its calculations of
fully diluted shares outstanding. Upon settlement of restricted
stock units, exercise of certain stock options or vesting of
restricted stock awards, the awards may be settled on a net basis,
with LendingTree remitting the required tax withholding amounts
from its current funds.
Amortization of intangibles are non-cash expenses relating
primarily to acquisitions. At the time of an acquisition, the
intangible assets of the acquired company, such as purchase
agreements, technology and customer relationships, are valued and
amortized over their estimated lives. Amortization of
intangibles are only excluded from Adjusted EBITDA.
Safe Harbor Statement Under the Private Securities Litigation
Reform Act of 1995
The matters contained in the discussion above may be considered
to be "forward-looking statements" within the meaning of the
Securities Act of 1933 and the Securities Exchange Act of 1934, as
amended by the Private Securities Litigation Reform Act of 1995.
Those statements include statements regarding the intent, belief or
current expectations or anticipations of LendingTree and members of
our management team. Factors currently known to management that
could cause actual results to differ materially from those in
forward-looking statements include the following: adverse
conditions in the primary and secondary mortgage markets and in the
economy, particularly interest rates; default rates on loans,
particularly unsecured loans; demand by investors for unsecured
personal loans; the effect of such demand on interest rates for
personal loans and consumer demand for personal loans; seasonality
of results; potential liabilities to secondary market purchasers;
changes in the Company's relationships with network lenders,
including dependence on certain key network lenders; breaches of
network security or the misappropriation or misuse of personal
consumer information; failure to provide competitive service;
failure to maintain brand recognition; ability to attract and
retain consumers in a cost-effective manner; the effects of
potential acquisitions of other businesses, including the ability
to integrate them successfully with LendingTree's existing
operations; accounting rules related to contingent consideration
that could materially affect earnings in future periods; ability to
develop new products and services and enhance existing ones;
competition; allegations of failure to comply with existing or
changing laws, rules or regulations, or to obtain and maintain
required licenses; failure of network lenders or other affiliated
parties to comply with regulatory requirements; failure to maintain
the integrity of systems and infrastructure; liabilities as a
result of privacy regulations; failure to adequately protect
intellectual property rights or allegations of infringement of
intellectual property rights; and changes in management. These and
additional factors to be considered are set forth under "Risk
Factors" in our Annual Report on Form 10-K for the period ended
December 31, 2015, in our quarterly
report on Form 10-Q for the period ended September 30, 2016 and in our other filings with
the Securities and Exchange Commission. We undertake no obligation
to update or revise forward-looking statements to reflect changed
assumptions, the occurrence of unanticipated events or changes to
future operating results or expectations.
About LendingTree, Inc.
LendingTree, Inc. (NASDAQ: TREE) operates the nation's leading
online loan marketplace and provides consumers with an array of
online tools and information to help them find the best loans for
their needs. LendingTree's online marketplace connects
consumers with multiple lenders that compete for their business,
empowering consumers as they comparison-shop across a full suite of
loans and credit-based offerings. Since its inception,
LendingTree has facilitated more than 65 million loan
requests. LendingTree provides access to its network of over
450 lenders offering home loans, home equity loans/lines of credit,
reverse mortgages, personal loans, auto loans, small business
loans, credit cards, student loans and more.
LendingTree, Inc. is headquartered in Charlotte, NC and maintains operations solely
in the United States. For more
information, please visit www.lendingtree.com.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/lendingtree-reports-record-4q--fy-2016-results-300412227.html
SOURCE LendingTree, Inc.