Strong Demand for Call Advertising Products
Drives 22% year-over-year Revenue Growth
Leads to an Increase in Annual
Guidance
Replacing 2013 column for Condensed Consolidated Statements of
Operations table for the three months ended.
The corrected release reads:
MARCHEX ANNOUNCES THIRD QUARTER 2013
RESULTS
Strong Demand for Call Advertising Products
Drives 22% year-over-year Revenue Growth
Leads to an Increase in Annual
Guidance
Marchex, Inc. (NASDAQ:MCHX), a mobile advertising
technology company, today announced its financial results for the
third quarter ended September 30, 2013.
“As mobile adoption continues to expand, phone calls are rapidly
emerging as one of the most valued actions in the purchasing path,”
said Russell Horowitz, Chairman and CEO of Marchex. “We see growing
momentum in our business as a result, and will continue to invest
our time, energy and resources in building call analytics
capabilities that drive the highest levels of client performance
and transparency.”
Q3 2013 Financial
Highlights1
- GAAP revenue was $40.6
million for the third quarter of 2013, compared to $33.7
million for the third quarter of 2012. Non-GAAP revenue, which
excludes domain sales recorded in GAAP revenue, was $39.7 million
for the third quarter of 2013.
- GAAP net income from continuing
operations was $598,000 for the third quarter of 2013, compared to
a GAAP net loss from continuing operations of $490,000 for the
third quarter of 2012.
- GAAP net income from continuing
operations attributable to common stockholders per diluted share
was $0.02 for the third quarter of 2013. This compares to GAAP net
loss from continuing operations attributable to common stockholders
per diluted share of $0.02 for the third quarter of 2012.
Q3 2013 Q3 2012
GAAP Revenue $40.6 million $33.7 million
Non-GAAP Results below exclude Domain Sales and Discontinued
Operations: Non-GAAP Revenue 2, 3 $39.7
million $33.7 million
Call-Driven and Other Revenue
$35.7 million $29.3 million
Archeo Revenue
2, 3 $4.0 million $4.4 million
Adjusted
OIBA3 $2.5 million $3.9 million
Adjusted EBITDA3 $3.4 million $4.8
million
1 In July 2013, certain pay-per-click assets were sold. As a
result, the financial results of these pay-per-click assets are
presented as net loss from discontinued operations, net of tax in
our condensed consolidated statements of operations in accordance
with GAAP, and are excluded from all other results unless otherwise
noted.
2 Excludes domain sales recognized in GAAP revenue. In September
2013 upon the launch of its domain marketplace, the company
commenced recognizing domain sales as revenue.
3 Reconciliations of non-GAAP measures are included in the
financial tables attached to this press release and we encourage
investors to examine the reconciling adjustments between the GAAP
and non-GAAP measures.
- Adjusted non-GAAP EPS3 from continuing
operations for the third quarter of 2013 was $0.04, compared to
$0.06 for the third quarter of 2012.
- Adjusted OIBA3 excluding domain sales2
was $2.5 million for the third quarter of 2013, compared to $3.9
million for the third quarter in 2012.
- Adjusted EBITDA3 excluding domain
sales2 was $3.4 million for the third quarter of 2013, compared to
$4.8 million for the third quarter in 2012.
Marchex Q3 and Recent Call-Driven
Business Highlights:
- Revenue. Call-driven and other
related revenue was $35.7 million for the third quarter of 2013 – a
22 percent increase compared to $29.2 million for the third quarter
of 2012.
- Products. We recently announced
two technologies to transform mobile and call advertising
measurement. Call DNA and Dynamic Tracking are designed to increase
efficiency and significantly lower customer acquisition costs for
advertisers by providing insights into which calls convert into
sales. These unique, patent-pending technologies provide a new and
deeper level of customer conversion data generated by ad
campaigns.
Call DNA provides:
- A simple, easy-to-understand
visualization of what is happening on phone calls, and ultimately
what outcomes were achieved, using automated call scoring
technology.
- A detailed break-down of how best to
optimize advertising campaigns to improve sales and overall
business performance.
Dynamic Tracking provides:
- Details on what, exactly, triggered a
phone call from a mobile consumer to an advertiser. This includes
specific keywords, ad impressions and web-based sessions.
- Easy campaign optimization to drive
more calls from new customers.
- People. During the quarter,
Marchex announced that Clark Kokich, advertising technology expert
and digital marketing thought leader, joined the company as its
Chief Strategy Officer. Mr. Kokich, with more than 14 years of
experience in the digital advertising space, most recently served
as Chairman of Razorfish, one of the largest digital marketing
agencies in the world, where he also held the roles of CEO and
President. He also oversaw strategic direction at Razorfish and
entrenched himself with clients, shaping digital innovation from
the ground up. Razorfish was the largest operating division within
aQuantive, an advertising technology and services giant, and Kokich
helped grow the company from pre-IPO status in 1999 to more than
$600 million in annualized sales, before it was acquired by
Microsoft in 2007.
- Customers and Partners. Marchex
announced a partnership with Marin Software, a leading revenue
acquisition management platform provider. Marin Software is now
using Marchex Call Analytics to give agencies and advertisers
powerful new insights into their ad campaigns and drive higher
returns on ad spend. We also announced an integration with
DoubleClick Search, a cross-engine search management platform.
DoubleClick advertisers can now access our Call Analytics data to
understand over-the-phone conversions that come from search-based
ads.
- In November, Marchex added its Twitter
account @marchex.com (Twitter.com/Marchex) and its company blog at
blog.marchex.com as designated channels to disclose material
information.
Archeo Q3 Business
Highlights:
- Revenue. Archeo non-GAAP revenue
was $4.0 million for the third quarter of 2013, which excludes
domain sales recognized in GAAP revenue.
- Domains sales. During the third
quarter of 2013, Archeo sold a total of 81 domains that yielded
$1.9 million.
- During the quarter, Archeo announced
the launch of the Domains Marketplace, which provides a gateway to
the premium portfolio of more than 200,000 domain names.
- In July 2013, certain pay-per-click
assets were sold for proceeds totaling up to $2.6 million as part
of a transaction to focus Archeo’s business on creating a premium
domain marketplace. The financial results of these sold assets are
presented as discontinued operations in our condensed consolidated
statement of operations in accordance with GAAP.
Business
Outlook
The following forward-looking statements
reflect Marchex's expectations as of November 5, 2013 and exclude
domain sales and discontinued operations:
Financial
guidance for the fiscal year ending December 31,
2013
Non-GAAP Revenue1 excluding domain
sales
More than $148.5 million Call Driven Revenue More
than $134 million
Adjusted OIBA from continuing
operations
$9-$10 million
Adjusted EBITDA from continuing
operations2
$13-$14 million
Call Driven Adjusted EBITDA3
More than $9 million
1 Excludes historical and any prospective
domain sales.
2 Includes estimated addbacks of $4.0 million
related to additional depreciation and amortization.
3This non-GAAP Call-Driven measure assigns all
Marchex indirect overhead costs to the Call-Driven results.
Reconciliations of non-GAAP measures are included in the financial
tables attached to this press release and we encourage investors to
examine the reconciling adjustments between the GAAP and non-GAAP
measures.
2013 GAAP income (loss) from continuing operations is expected
to be ($0.8) million or better, assuming stock-based compensation
between $9-$10 million and amortization of intangible assets from
acquisitions between $3-$3.5 million. This estimate excludes any
prospective domain sales or gain or loss on sales and disposals of
intangible assets.
Financial
guidance for the Fourth Quarter ending December 31,
2013
Non-GAAP Revenue1 excluding domain sales More than
$36.5 million Call Driven Revenue More than $33.5 million
Adjusted OIBA from continuing operations $2.1-$3.1 million
Adjusted EBITDA from continuing operations2 $3.1-$4.1
million
1 Excludes any prospective domain sales.
2 Includes estimated addbacks of $1.0 million related to
additional depreciation and amortization.
Fourth quarter GAAP income (loss) from continuing operations is
expected to be ($1.6) million or better, assuming stock-based
compensation between $2-$3 million and amortization of intangible
assets from acquisitions between $0.4-$0.7 million. This estimate
excludes any prospective domain sales or gain or loss on sales and
disposals of intangible assets.
Conference Call and Webcast
Information
Management will hold a conference call, starting at 5:00 p.m. ET
on Tuesday, November 5, 2013 to discuss its third quarter ended
September 30, 2013 financial results, and other company updates.
Access to the live webcast of the conference call will be available
online from the Investors section of the Marchex’s website at
www.marchex.com. An archived version
of the webcast will also be available at the same location,
beginning two hours after completion of the call.
About Marchex
Marchex is a mobile advertising technology company. The company
provides a suite of products and services for businesses that
depend on consumer phone calls to drive sales. Marchex’s mobile
advertising platform delivers new customer phone calls to
businesses, while its technology analyzes the data in these calls
to help maximize ad campaign results. Marchex disrupts traditional
advertising models by giving businesses full transparency into
their ad campaign performance and charging them based on new
customer acquisition.
Please visit www.marchex.com, blog.marchex.com or @marchex on
Twitter (Twitter.com/Marchex), where Marchex discloses material
information from time to time about the company, its financial
information, and its business.
Forward-Looking
Statements:
This press release contains forward-looking statements that
involve substantial risks and uncertainties. All statements, other
than statements of historical facts, included in this press release
regarding our strategy, future operations, future financial
position, future revenues, other financial guidance, acquisitions,
projected costs, prospects, plans and objectives of management are
forward-looking statements. We may not actually achieve the plans,
intentions or expectations disclosed in our forward-looking
statements and you should not place undue reliance on our
forward-looking statements. Actual results or events could differ
materially from the plans, intentions and expectations disclosed in
the forward-looking statements we make. There are a number of
important factors that could cause Marchex's actual results to
differ materially from those indicated by such forward-looking
statements which are described in the "Risk Factors" section of our
most recent periodic report and registration statement filed with
the SEC. All of the information provided in this release is as of
November 5, 2013 and Marchex undertakes no duty to update the
information provided herein.
Non-GAAP Financial
Information:
To supplement Marchex's consolidated financial statements
presented in accordance with GAAP and to provide clarity internally
and externally, Marchex uses certain non-GAAP measures of financial
performance and liquidity, including OIBA , Adjusted OIBA, Adjusted
EBITDA, Revenue excluding and including Domain Sales, Adjusted OIBA
and EBITDA excluding and including Domain Sales, Revenue with
Discontinued Operations excluding and including Domain Sales, and
Adjusted OIBA and EBITDA with Discontinued Operations excluding and
including Domain Sales. Marchex also provides Call-Driven and
Archeo Adjusted OIBA and EBITDA, and Adjusted non-GAAP EPS.
OIBA represents income (loss) from
operations plus (1) stock-based compensation expense and (2)
amortization of intangible assets from acquisitions. This measure,
among other things, is one of the primary metrics by which Marchex
evaluates the performance of its business. Additionally, Marchex's
management uses Adjusted OIBA, which
excludes any gain/loss on sales and disposals of intangible assets
for each asset and acquisition and separation related costs as
these items are not indicative of Marchex’s recurring core
operating results and any domain sales contribution. Adjusted OIBA
is the basis on which Marchex's internal budgets are based and by
which Marchex's management is currently evaluated. Marchex believes
these measures are useful to investors because they represent
Marchex's consolidated operating results, taking into account
depreciation and other intangible amortization, which Marchex
believes is an ongoing cost of doing business, but excluding the
effects of certain other expenses or gain/loss such as stock-based
compensation, amortization of intangible assets from acquisitions,
acquisition and separation related costs, domain sales contribution
and gain/loss on sales and disposals of intangible assets.
Adjusted EBITDA represents income
(loss) before interest, income taxes, depreciation, amortization,
stock compensation expense, acquisition and separation related
cost, domain sales contribution and gain/loss on sales and
disposals of intangible assets. Marchex believes that Adjusted
EBITDA is another alternative measure of liquidity to GAAP net cash
provided by operating activities that provides meaningful
supplemental information regarding liquidity and is used by
Marchex's management to measure its ability to fund operations and
its financing obligations.
Revenue excluding Domain Sales
represents GAAP revenue excluding domain sales sold through
Marchex’s Domain Marketplace which are recognized in GAAP revenue.
Revenue with Domain Sales represents
GAAP revenue plus sales proceeds from the sale of intangible
assets. Adjusted OIBA and EBITDA with Domain
Sales includes the above descriptions of Adjusted OIBA and
EBITDA plus any domain sales contribution and gain/loss on sales
and disposals of intangible assets. Revenue
with Discontinued Operations excluding Domain Sales
represents GAAP Revenue plus discontinued operations and excludes
domain sales sold through Marchex’s Domain Marketplace and
recognized in GAAP revenue. Revenue with
Discontinued Operations including Domain Sales represents
GAAP Revenue plus discontinued operations and includes sales
proceeds from the sale of intangible assets. For GAAP purposes,
operating results of discontinued operations are shown as
discontinued operations in the condensed consolidated statements of
operations. Adjusted OIBA and EBITDA with
Discontinued Operations excluding Domain Sales includes the
above descriptions of Adjusted OIBA and EBITDA plus the operating
results of discontinued operations and excludes domain sales
contribution. Adjusted OIBA and EBITDA with
Discontinued Operations including Domain sales includes the
above descriptions of Adjusted OIBA and EBITDA plus the operating
results of discontinued operations and includes domain sales
contribution and gain/loss on sales and disposals of intangible
assets. Call-Driven Adjusted OIBA and
EBITDA includes the above descriptions of Adjusted OIBA and
EBITDA for the Call-Driven segment. Archeo
non-GAAP Measures include the measures above for the Archeo
segment. Financial analysts and investors may use the non-GAAP
historical Revenue with Domain Sales, Adjusted OIBA and EBITDA with
Domain Sales and similarly those including Discontinued Operations
to help with comparative financial evaluation to make informed
investment decisions. The Call-Driven Adjusted OIBA and EBITDA
assigns all Marchex indirect overhead costs to the Call-Driven
results.
Adjusted non-GAAP EPS represents
Adjusted non-GAAP Net Income (Loss) applicable to common
stockholders divided by GAAP diluted shares outstanding. Adjusted
non-GAAP Net Income (Loss) applicable to common stockholders
generally captures those items on the statement of operations that
have been, or ultimately will be, settled in cash exclusive of
certain items that are not indicative of Marchex’s recurring core
operating results and represents net income (loss) applicable to
common stockholders plus the net of tax effects of: (1) stock-based
compensation expense, (2) amortization of intangible assets from
acquisitions, (3) domain sales contribution and gain/loss on sales
and disposals of intangible assets and domain sales contribution,
(4) acquisition and separation related costs, (5) interest and
other income (expense), (6) discontinued operations and gain on
sale of discontinued operations, net of tax and (7) dividends paid
to participating securities, and also excludes the effect of the
tax valuation allowance. Financial analysts and investors may use
Adjusted non-GAAP EPS to analyze Marchex's financial performance
since these groups have historically used EPS related measures,
along with other measures, to estimate the value of a company, to
make informed investment decisions, and to evaluate a company's
operating performance compared to that of other companies in its
industry.
Marchex's management believes that investors should have access
to, and Marchex is obligated to provide, the same set of tools that
management uses in analyzing the company's results. These non-GAAP
measures should be considered in addition to results prepared in
accordance with GAAP, and should not be considered in isolation, as
a substitute for, or superior to, GAAP results. Marchex’s non-GAAP
financial measures may be defined differently from time to time and
may be defined differently than similar titled terms used by other
companies, and accordingly, care should be exercised in
understanding how Marchex defines its non-GAAP financial measures
in this release. Marchex endeavors to compensate for the
limitations of the non-GAAP measures presented by providing the
comparable GAAP measure with equal or greater prominence, GAAP
financial statements, and detailed descriptions of the reconciling
items and adjustments, including quantifying such items, to derive
the non-GAAP measure.
MARCHEX, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations (in
thousands, except per share data) (unaudited)
Three Months Ended September 30,
2012 2013 Revenue $
33,691 $
40,560
Expenses: Service costs (1),(2) 19,744
25,293
Sales and marketing (1),(2) 2,542
2,801
Product development (1),(2) 5,510
6,833
General and administrative (1),(2) 5,678
4,679
Amortization of intangible assets from acquisitions 1,055
709
Acquisition and separation related costs 296
286
Total operating expenses 34,825
40,601
Gain on sales and disposals of intangible assets, net 713
1,047
Income from operations (421 )
1,006
Interest expense and other, net (118 )
(19
) Income (loss) from continuing operations before provision for
income taxes (539 )
987
Income tax expense (benefit) (49 )
389
Net income (loss) from continuing operations (490 )
598
Discontinued operations: Loss from discontinued operations, net of
tax (53 )
(46
) Gain on sale from discontinued operations, net of tax -
929 Discontinued operations, net of tax
(53 )
883
Net income (loss) (543 )
1,481
Dividends paid to participating securities (123 )
- Net income (loss) applicable to common stockholders
$ (666 ) $
1,481
Basic and diluted net income (loss) per share: Net income
(loss) from continuing operations $ (0.02 ) $
0.02
Discontinued operations, net of tax (0.00 )
0.02 Net income (loss) applicable to common stockholders $
(0.02 ) $
0.04
Dividends paid per share $ 0.04 $ - Shares used to calculate basic
net income (loss) per share applicable to common stockholders Class
A 9,570
8,377
Class B 24,536
27,308
Shares used to calculate diluted net income (loss) per share
applicable to common stockholders Class A 9,570
8,377
Class B 34,106
37,277
(1) Includes stock-based compensation allocated as follows: Service
costs $ 554 $
455
Sales and marketing 153
211
Product development 203 361 General and administrative 2,792
1,338
Total $ 3,702 $ 2,365 (2) Certain
reclassifications have been made to prior period to conform to
current period presentation.
MARCHEX, INC. AND
SUBSIDIARIES Condensed Consolidated Statements of
Operations (in thousands, except per share data)
(unaudited) Nine Months Ended September
30, 2012 2013
Revenue $ 100,358 $ 112,870 Expenses: Service costs (1),(2) 56,821
68,025 Sales and marketing (1),(2) 10,494 8,350 Product development
(1),(2) 17,237 20,586 General and administrative (1),(2) 17,281
15,003 Amortization of intangible assets from acquisitions 3,674
2,500 Acquisition and separation related costs 164
940 Total operating expenses 105,671 115,404
Gain on sales and disposals of intangible assets, net 5,434
3,739 Income from operations 121 1,205
Interest expense and other, net (430 ) (48 )
Income (loss) from continuing operations before provision for
income taxes (309 ) 1,157 Income tax expense 458
797 Net income (loss) from continuing
operations (767 ) 360 Discontinued operations: Loss from
discontinued operations, net of tax (95 ) (77 ) Gain on sale from
discontinued operations, net of tax -
929 Discontinued operations, net of tax (95 ) 852 Net income
(loss) (862 ) 1,212 Dividends paid to participating securities
(262 ) - Net income (loss) applicable
to common stockholders $ (1,124 ) $ 1,212 Basic and
diluted net income (loss) per share: Net income (loss) from
continuing operations $ (0.03 ) $ 0.01 Discontinued operations, net
of tax (0.00 ) 0.02 Net income (loss)
applicable to common stockholders $ (0.03 ) $ 0.03 Dividends paid
per share $ 0.08 $ - Shares used to calculate basic net income
(loss) per share applicable to common stockholders Class A 9,576
9,168 Class B 24,303 26,280 Shares used to calculate diluted net
income (loss) per share applicable to common stockholders Class A
9,576 9,168 Class B 33,879 36,371
(1)
Includes stock-based compensation allocated as follows: Service
costs $ 1,545 $ 818 Sales and marketing 2,008 474 Product
development 860 1,127 General and administrative 7,982
4,456 Total $ 12,395 $
6,875
(2)
Certain reclassifications have been made to prior period to conform
to current period presentation.
MARCHEX, INC. AND
SUBSIDIARIES Condensed Consolidated Balance Sheets
(in thousands) (unaudited)
December 31, September 30, Assets
2012 2013 Current
assets: Cash and cash equivalents $ 15,930 $ 25,151 Accounts
receivable, net 25,988 30,817 Prepaid expenses and other current
assets 2,667 3,149 Refundable taxes 264 72 Deferred tax assets
830 1,108 Total current assets
45,679 60,297 Property and equipment, net 6,005 5,967
Deferred tax assets 27,677 26,494 Intangibles and other assets, net
611 569 Goodwill 65,815 65,679 Intangible assets from acquisitions,
net 3,360 860 Total Assets $
149,147 $ 159,866
Liabilities and
Stockholders' Equity Current liabilities: Accounts
payable $ 12,378 $ 15,440 Accrued expenses and other current
liabilities 9,609 8,838 Deferred revenue 2,009
1,506 Total current liabilities 23,996 25,784
Other non-current liabilities 2,216
2,186 Total Liabilities 26,212 27,970 Class A
common stock 98 80 Class B common stock 284 301 Treasury stock (13
) - Additional paid-in capital 295,532 303,269 Accumulated deficit
(172,966 ) (171,754 ) Total Stockholders'
Equity 122,935 131,896 Total
Liabilities and Stockholders' Equity $ 149,147 $
159,866
MARCHEX, INC. AND SUBSIDIARIES
Reconciliation of GAAP Income (Loss) from Operations to
Operating Income Before Amortization (OIBA) and Adjusted
Operating Income Before Amortization (Adjusted OIBA) (in
thousands) (unaudited)
Three Months Ended September 30, 2012
2013 Income (loss) from
operations $ (421 ) $ 1,006 Stock-based compensation 3,702 2,365
Amortization of intangible assets from acquisitions 1,055
709 Operating income before
amortization (OIBA) 4,336 4,080 Acquisition and separation related
costs 296 286 Domain sales contribution - (839 ) Gain on sales and
disposals of intangible assets, net (713 )
(1,047 ) Adjusted operating income before amortization (Adjusted
OIBA) $ 3,919 $ 2,480
Nine
Months Ended September 30, 2012
2013 Income from operations $
121 $ 1,205 Stock-based compensation 12,395 6,875 Amortization of
intangible assets from acquisitions 3,674
2,500 Operating income before amortization (OIBA)
16,190 10,580 Acquisition and separation related costs 164 940
Domain sales contribution - (839 ) Gain on sales and disposals of
intangible assets, net (5,434 ) (3,739 )
Adjusted operating income before amortization (Adjusted OIBA) $
10,920 $ 6,942
Reconciliation
from Net Cash provided by Operating Activities to Adjusted
EBITDA (in thousands) (unaudited)
Three Months Ended September 30,
2012 2013 Net cash
provided by operating activities $ 3,656 $ 4,332 Changes in asset
and liabilities 811 (1,374 ) Income tax expense (benefit) (49 ) 389
Separation related costs 296 286 Interest expense and other, net 28
15 Less: Domain sales contribution - (839 ) Loss from discontinued
operations, net of tax 53 46 Tax effect on gain on sale of
discontinued operations - 563 Excess tax benefits related to stock
compensation 42 13 Adjusted
EBITDA $ 4,837 $ 3,431 Net cash provided by
(used in) investing activities $ (103 ) $ 1,235 Net
cash provided by (used in) financing activities $ (1,592 ) $
842
Nine Months Ended September
30, 2012 2013
Net cash provided by operating activities $ 15,590 $ 7,487
Changes in asset and liabilities (2,884 ) 482 Income tax
expense 458 797 Acquisition and separation related costs 296 940
Interest expense and other, net 68 44 Less: Domain sales
contribution - (839 ) Loss from discontinued operations, net of tax
95 77 Tax effect on gain on sale of discontinued operations - 563
Excess tax benefits related to stock compensation 162
209 Adjusted EBITDA $ 13,785 $
9,760 Net cash provided by investing activities $ 3,123
$ 2,197 Net cash used in financing activities
$ (20,622 ) $ (463 )
MARCHEX, INC. AND
SUBSIDIARIES Reconciliation of GAAP EPS to Adjusted Non-GAAP
EPS (in thousands, except per share data)
(unaudited) Three Months Ended
September 30, 2012
2013 Adjusted Non-GAAP EPS from continuing operations
$ 0.06 $ 0.04 Net income (loss) from
continuing operations applicable to common stockholders - diluted
(GAAP EPS) $ (0.02 ) $ 0.02 Shares used to calculate diluted net
income (loss) per share applicable to common stockholders 34,106
37,277 Net income (loss) applicable to common stockholders $
(666 ) $ 1,481 Stock-based compensation 3,702 2,365 Acquisition and
separation related costs 296 286 Amortization of intangible assets
from acquisitions 1,055 709 Gain on sales and disposals of
intangible assets, net (713 ) (1,047 ) Domain sales contribution -
(839 ) Interest expense and other, net 118 19 Dividends paid to
participating securities 123 - Discontinued operations, net of tax
53 (883 ) Estimated impact of income taxes (1,399 )
(488 ) Adjusted Non-GAAP net income from continuing
operations $ 2,569 $ 1,603
Adjusted Non-GAAP EPS from continuing operations $ 0.06
$ 0.04 Shares used to calculate diluted
net income (loss) per share applicable to common stockholders
34,106 37,277 Weighted average stock options and common shares
subject to purchase or cancellation (if applicable) 1,361 -
Weighted average common shares related to deferred acquisition
payments 4,907 - Diluted shares
used to calculate Adjusted Non-GAAP EPS (1) 40,374
37,277 (1) For the purpose of computing
the number of diluted shares for Adjusted Non-GAAP EPS, Marchex
uses the accounting guidance that would be applicable for computing
the number of diluted shares for GAAP EPS.
MARCHEX, INC. AND SUBSIDIARIES Reconciliation of GAAP EPS
to Adjusted Non-GAAP EPS (in thousands, except per share
data) (unaudited) Nine Months Ended
September 30, 2012
2013 Adjusted Non-GAAP EPS $
0.18 $ 0.12 Net income (loss) from
continuing operations per share applicable to common stockholders -
diluted (GAAP EPS) $ (0.03 ) $ 0.01 Shares used to calculate
diluted net income (loss) per share applicable to common
stockholders 33,879 36,371 Net income (loss) applicable to
common stockholders $ (1,124 ) $ 1,212 Stock-based compensation
12,395 6,875 Acquisition and separation related costs 164 940
Amortization of intangible assets from acquisitions 3,674 2,500
Gain on sales and disposals of intangible assets, net (5,434 )
(3,739 ) Domain sales contribution - (839 ) Interest expense and
other, net 430 48 Dividends paid to participating securities 262 -
Tax valuation allowance - 651 Discontinued operations, net of tax
95 (852 ) Estimated impact of income taxes (3,373 )
(2,291 ) Adjusted Non-GAAP net income from continuing
operations $ 7,089 $ 4,504
Adjusted Non-GAAP EPS from continuing operations $ 0.18
$ 0.12 Shares used to calculate diluted net
income (loss) per share applicable to common stockholders 33,879
36,371 Weighted average stock options and common shares subject to
purchase or cancellation (if applicable) 1,340 - Weighted average
common shares related to deferred acquisition payments 4,907
- Diluted shares used to calculate
Adjusted Non-GAAP EPS (1) 40,126 36,371
(1 )
For the purpose of computing the number of
diluted shares for non-GAAP EPS, Marchex uses the accounting
guidance that would be applicable for computing the number of
diluted shares for GAAP EPS.
MARCHEX, INC. AND SUBSIDIARIES (in
thousands) (unaudited) Reconciliation of GAAP
Income (Loss) from Operations to Operating Income before
Amortization (OIBA) and Adjusted Operating Income Before
Amortization (Adjusted OIBA) 3
months ended 9 months ended
3/31/2012 6/30/2012
9/30/2012
12/31/2012 3/31/2013
6/30/2013
9/30/2013 9/30/2012
9/30/2013
Income (loss) from operations $ (616 ) $ 1,158 $ (421
) $ (17,364 ) $ 297 $ (98 ) $ 1,006 $ 121 $ 1,205 Stock-based
compensation 3,891 4,802 3,702 3,243 1,907 2,603 2,365 12,395 6,875
Amortization of intangible assets from acquisitions 1,537
1,082 1,055
1,055 1,055 736
709 3,674
2,500 Operating income before amortization (OIBA) 4,812
7,042 4,336
(13,066
) 3,259 3,241 4,080 16,190 10,580 Acquisition and separation
related costs (132 ) - 296 589 345 309 286 164 940 Impairment of
goodwill - - - 15,837 - - - - - Domain sales contribution - - - - -
- (839 ) - (839 ) Gain on sales and disposals of intangible assets,
net (1,463 ) (3,258 ) (713 )
(862 ) (1,362 ) (1,330 )
(1,047 ) (5,434 ) (3,739 )
Adjusted operating income before amortization (Adjusted OIBA) $
3,217 $ 3,784 $ 3,919 $
2,498
$ 2,242 $ 2,220 $ 2,480
$ 10,920 $ 6,942
Reconciliation from Net Cash provided by Operating Activities to
Adjusted EBITDA 3 months ended 9 months
ended 3/31/2012 6/30/2012
9/30/2012
12/31/2012 3/31/2013
6/30/2013
9/30/2013 9/30/2012
9/30/2013 Net cash provided by
operating activities $ 3,954 $ 7,980 $ 3,656 $ 4,311 $ 2,141 $
1,014 $ 4,332 $ 15,590 $ 7,487 Changes in asset and liabilities 302
(3,997 ) 811 (17,696 )
462
1,394
(1,374 ) (2,884 ) 482 Income tax expense (benefit) (88 ) 595 (49 )
16,109 165 243 389 458 797 Separation related costs - - 296 589 345
309 286 296 940 Less: Domain sales contribution - - - - - - (839 )
- (839 ) Discontinued operations, net of tax (10 ) 52 53 843 31 (0
) 46 95 77 Tax effect of gain on sale of discontinued operations -
- - - - - 563 - 563 Interest expense and other, net 18 22 28 19 17
12 15 68 44 Excess tax benefits related to stock compensation 97
23 42
146 7 189
13 162 209
Adjusted EBITDA $ 4,273 $ 4,675 $ 4,837
$ 4,321 $
3,168
$
3,161
$ 3,431 $ 13,785 $ 9,760
Net cash provided by (used in) investing activities $ 1,194
$ 2,032 $ (103 ) $ 197 $
512 $ 449 $ 1,235 $ 3,123
$ 2,196 Net cash provided by (used in) financing
activities $(1,296 ) $ (17,734 ) $ (1,592 ) $
(24,112 ) $ (1,483 ) $ 179 $ 842
$ (20,622 ) $ (463 )
MARCHEX, INC. AND
SUBSIDIARIES Quarterly Financial Summary
Information (in thousands)
NON-GAAP MEASURES
Amounts below exclude Domain Sales and
Discontinued Operations
CONSOLIDATED Q112
Q212 Q312 Q412
Q113 Q213 Q313
Non-GAAP Revenue $ 33,835 $
32,832 $ 33,691 $ 32,436
$ 34,732 $ 37,578 $
39,661 Adjusted OIBA $ 3,217
$ 3,784 $ 3,919 $ 2,498
$ 2,242 $ 2,220 $ 2,480
Adjusted EBITDA $ 4,273
$ 4,675 $ 4,837 $
4,321 $ 3,168 $
3,161 $ 3,431
CALL-DRIVEN Q112
Q212 Q312 Q412
Q113 Q213 Q313
Revenue $ 26,651 $ 27,497
$ 29,269 $ 28,470 $
31,108 $ 33,893 $ 35,668
Adjusted OIBA $ 171 $ 1,513
$ 2,199 $ 1,145 $ 1,357
$ 1,496 $ 1,690 Adjusted
EBITDA $ 980 $ 2,316
$ 3,063 $ 2,917
$ 2,245 $ 2,399 $
2,598
ARCHEO Q112 Q212
Q312 Q412 Q113
Q213 Q313 Non-GAAP Revenue
$ 7,184 $ 5,335 $ 4,422
$ 3,965 $ 3,624 $
3,685
$
3,993
Adjusted OIBA $ 3,046 $
2,270 $ 1,720 $ 1,353 $
885 $ 724 $ 790
Adjusted EBITDA $ 3,293 $
2,359 $ 1,774 $
1,404 $ 923 $ 762
$ 833 Prior periods have been adjusted
to confirm to current period presentation due to change in segment
profitability measures.
MARCHEX, INC. AND
SUBSIDIARIES Financial Summary by Segment (in
thousands) (unaudited)
Three months ended
Nine months ended 3/31/2012
6/30/2012 9/30/2012
12/31/2012 3/31/2013
6/30/2013 9/30/2013
9/30/2012 9/30/2013 Marchex -
consolidated Revenue excluding Discontinued Operations4
- GAAP $ 33,835 $ 32,832 $ 33,691 $
32,436 $ 34,732 $ 37,578 $ 40,560 $
100,358 $ 112,870
Revenue excluding Discontinued
Operations and Domain Sales2 $
33,835 $ 32,832 $
33,691 $ 32,436 $
34,732 $ 37,578 $
39,661 $ 100,358 $
111,971 Revenue with Domain Sales3 and excluding
Discontinued Operations $ 35,309 $ 36,102 $ 34,404 $ 33,299 $
36,094 $ 38,908 $ 41,607 $ 105,815 $ 116,609 Revenue including
Discontinued Operations and excluding Domain Sales2 $ 35,481 $
34,014 $ 34,821 $ 33,990 $ 36,213 $ 39,019 $ 39,923 $ 104,316 $
115,155 Revenue with Domain Sales3 and including Discontinued
Operations $ 36,955 $ 37,284 $ 35,534 $
34,853 $ 37,575 $ 40,349 $ 41,869 $
109,773 $ 119,793
Adjusted OIBA excluding Discontinued
Operations and Domain Sales2 $
3,217 $ 3,784 $
3,919 $ 2,498 $
2,242 $ 2,220 $
2,480 $ 10,920 $
6,942 Adjusted OIBA with Domain Sales and excluding
Discontinued Operations4 $ 4,681 $ 7,042 $ 4,631 $ 3,360 $ 3,603 $
3,550 $ 4,366 $ 16,354 $ 11,519 Adjusted OIBA including
Discontinued Operations and excluding Domain Sales2 $ 3,252 $ 3,728
$ 3,862 $ 2,589 $ 2,205 $ 2,231 $ 2,409 $ 10,842 $ 6,845 Adjusted
OIBA with Domain Sales3 and including Discontinued Operations
$ 4,715 $ 6,986 $ 4,575 $ 3,451
$ 3,568 $ 3,561 $ 4,295 $ 16,276 $
11,424
Adjusted EBITDA excluding Discontinued Operations and
Domain Sales2 $ 4,273
$ 4,675 $ 4,837 $
4,321 $ 3,168 $
3,161 $ 3,431 $
13,785 $ 9,760 Adjusted EBITDA with
Domain Sales3 and excluding Discontinued Operations4 $ 5,737 $
7,933 $ 5,550 $ 5,183 $ 4,530 $ 4,490 $ 5,317 $ 19,219 $ 14,337
Adjusted EBITDA including Discontinued Operations and excluding
Domain Sales2 $ 4,309 $ 4,619 $ 4,781 $ 4,412 $ 3,133 $ 3,172 $
3,359 $ 13,709 $ 9,664 Adjusted EBITDA with Domain Sales3 and
including Discontinued Operations $ 5,773 $ 7,877 $ 5,493 $ 5,275 $
4,495 $ 4,501 $ 5,245 $ 19,143 $ 14,241
Call-Driven and
Other1 Revenue $ 26,651 $ 27,497 $ 29,269 $ 28,470 $
31,108 $ 33,893 $ 35,668 $ 83,417 $ 100,669 Adjusted OIBA $ 171 $
1,513 $ 2,199 $ 1,145 $ 1,357 $ 1,496 $ 1,690 $ 3,883 $ 4,543
Adjusted EBITDA $ 980 $ 2,316 $ 3,063 $
2,917 $ 2,245 $ 2,399 $ 2,598 $ 6,359 $
7,242
Archeo1 Revenue excluding Discontinued
Operations $ 7,184 $ 5,335 $ 4,422 $ 3,965 $ 3,624 $ 3,685 $ 4,893
$ 16,941 $ 12,202 Revenue excluding Discontinued Operations and
Domain Sales2 $ 7,184 $ 5,335 $ 4,422 $ 3,965 $ 3,624 $ 3,685 $
3,994 $ 16,941 $ 11,303 Revenue with Domain Sales excluding
Discontinued Operations4 $ 8,658 $ 8,605 $ 5,135 $ 4,828 $ 4,986 $
5,016 $ 5,940 $ 22,398 $ 15,942 Revenue including Discontinued
Operations and excluding Domain Sales2 $ 8,830 $ 6,517 $ 5,552 $
5,519 $ 5,106 $ 5,127 $ 4,256 $ 20,899 $ 14,489 Revenue with Domain
Sales3 and including Discontinued Operations $ 10,304
$ 9,787 $ 6,265 $ 6,382 $ 6,467 $ 6,457
$ 6,202 $ 26,356 $ 19,126 Adjusted OIBA excluding
Discontinued Operations and Domain Sales2 $ 3,046 $ 2,270 $ 1,720 $
1,353 $ 885 $ 724 $ 790 $ 7,036 $ 2,399 Adjusted OIBA with Domain
Sales3 excluding Discontinued Operations4 $ 4,510 $ 5,528 $ 2,431 $
2,215 $ 2,246 $ 2,054 $ 2,676 $ 12,469 $ 6,976 Adjusted OIBA
including Discontinued Operations and excluding Domain Sales2 $
3,081 $ 2,215 $ 1,662 $ 1,444 $ 849 $ 735 $ 719 $ 6,958 $ 2,303
Adjusted OIBA with Domain Sales3 and including Discontinued
Operations $ 4,544 $ 5,472 $ 2,375 $
2,306 $ 2,211 $ 2,065 $ 2,605 $ 12,391
$ 6,881 Adjusted EBITDA excluding Discontinued Operations and
Domain Sales2 $ 3,293 $ 2,359 $ 1,774 $ 1,404 $ 923 $ 762 $ 833 $
7,426 $ 2,518 Adjusted EBITDA with Domain Sales excluding
Discontinued Operations4 $ 4,757 $ 5,617 $ 2,487 $ 2,266 $ 2,285 $
2,091 $ 2,719 $ 12,860 $ 7,095 Adjusted EBITDA including
Discontinued Operations and excluding Domain Sales2 $ 3,329 $ 2,303
$ 1,718 $ 1,495 $ 888 $ 773 $ 761 $ 7,350 $ 2,422 Adjusted EBITDA
with Domain Sales3 and including Discontinued Operations $ 4,793 $
5,561 $ 2,430 $ 2,358 $ 2,250 $ 2,102 $ 2,647 $ 12,784 $ 6,999
1 The financial results for Call-Driven and Archeo
are preliminary and have been derived from the unaudited
consolidated financial statements of Marchex, Inc. for all periods
presented. Corporate overhead expenses have been reallocated in
prior periods to conform to current period presentation. The
unaudited Call-Driven financial results include certain direct
operating expenses and general corporate overhead expenses in all
periods presented. The unaudited Archeo financial results include
direct operating expenses for all periods presented. 2 In
September 2013, Marchex announced and launched its Domain
Marketplace and through it, commenced buying and selling of
domains. Domain sales occurring after this date are included in
revenue and related cost in service cost. Prior to this date,
domain sales were recognized in gain on sales and disposals of
intangible assets in the unaudited consolidated financial
statements. 3 Includes all domain sales recognized in
gain on sales and disposals of intangible assets and in revenue and
service costs. 4 Operating results of discontinued operations
relate to certain pay-per-click assets sold in July 2013 and are
included in discontinued operations, net of tax in the unaudited
consolidated financial statements.
MARCHEX,
INC. AND SUBSIDIARIES Archeo and Discontinued Operations
(in thousands) (unaudited)
Three months ended Nine months ended
3/31/2012 6/30/2012
9/30/2012 12/31/2012
3/31/2013 6/30/2013
9/30/2013 9/30/2012
9/30/2013 Archeo1
including Discontinued Operations4
Revenue excluding Domain Sales2 $ 8,830 $ 6,517 $
5,552 $ 5,519 $ 5,106
$
5,127
$ 4,256
$
20,899
$ 14,489 Revenue with Domain Sales4 $ 10,304 $ 9,787
$ 6,265 $ 6,382 $ 6,467
$
6,457
$ 6,202
$
26,356
$ 19,126 Adjusted OIBA excluding Domain Sales3
$ 3,081 $ 2,215 $ 1,662 $ 1,444 $ 849
$
735
$
719
$
6,958
$ 2,303 Adjusted OIBA with Domain Sales4 $ 4,544 $
5,472 $ 2,375 $ 2,306 $ 2,211
$
2,065
$ 2,605
$
12,391
$ 6,881 Adjusted EBITDA excluding Domain
Sales3 $ 3,329 $ 2,303 $ 1,718 $ 1,495 $ 888
$
773
$ 761
$
7,350
$ 2,422 Adjusted EBITDA with Domain Sales4 $ 4,793 $
5,561 $ 2,430 $ 2,358 $ 2,250
$
2,102
$ 2,647
$
12,784
$ 6,999
Discontinued
Operations4 Revenue $ 1,646 $ 1,182 $ 1,130 $ 1,554 $
1,482
$
1,441
$ 262
$
3,958
$ 3,184 Adjusted OIBA $ 35 $ (56 ) $ (57 ) $ 91 $ (36 )
$
10
$ (71 )
$
(78
) $ (97 ) Adjusted EBITDA $ 36 $ (56 ) $ (56 ) $ 92 $ (36 )
$
11
$ (71 )
$
(76
) $ (96 )
Archeo excluding Discontinued Operations
Revenue excluding Domain Sales3 $ 7,184 $ 5,335 $ 4,422 $ 3,965 $
3,624
$
3,685
$ 3,994
$
16,941
$ 11,303 Revenue with Domain Sales4 $ 8,658 $ 8,605
$ 5,135 $ 4,828 $ 4,986
$
5,016
$ 5,940
$
22,398
$ 15,942 Adjusted OIBA excluding Domain Sales3
$ 3,046 $ 2,270 $ 1,720 $ 1,353 $ 885
$
724
$ 790
$
7,036
$ 2,399 Adjusted OIBA with Domain Sales4 $ 4,510 $
5,528 $ 2,431 $ 2,215 $ 2,246
$
2,054
$ 2,676
$
12,469
$ 6,976 Adjusted EBITDA excluding Domain
Sales3 $ 3,293 $ 2,359 $ 1,774 $ 1,403 $ 923
$
762
$ 833
$
7,426
$ 2,518 Adjusted EBITDA with Domain Sales4 $ 4,757 $
5,617 $ 2,487 $ 2,266 $ 2,285
$
2,091
$ 2,719
$
12,860
$ 7,095 1 The financial results of
Archeo are preliminary and have been derived from the unaudited
consolidated financial statements of Marchex, Inc. for all periods
presented. The unaudited Archeo financial results include direct
operating expenses for all periods presented. 2 In September
2013, Marchex announced and launched its Domain Marketplace and
through it, commenced buying and selling of domains. Domain sales
occurring after this date are included in revenue and related cost
in service cost. Prior to this date, domain sales were recognized
in gain on sales and disposals of intangible assets in the
unaudited consolidated financial statements. 3
Includes all domain sales recognized in gain on sales and disposals
of intangible assets and in revenue and service costs. 4 Operating
results of discontinued operations relate to certain pay-per-click
assets sold in July 2013 and are included in discontinued
operations, net of tax in the unaudited consolidated financial
statements.
MARCHEX, INC. AND
SUBSIDIARIES Corporate Overhead Cost Allocation by
Segment (in thousands) (unaudited)
Three months ended
Nine months ended 3/31/2012
6/30/2012 9/30/2012
12/31/2012
3/31/2013 6/30/2013
9/30/2013 9/30/2012
9/30/2013 Call Driven and
Other1 Adjusted OIBA $ 171 $ 1,513 $ 2,199 $ 1,145 $
1,356 $ 1,497
$
1,690
$ 3,883 $ 4,543 Adjusted EBITDA $ 980 $ 2,316
$ 3,063 $ 2,917 $ 2,245
$ 2,399
$
2,598
$ 6,359 $ 7,243 Effect of Reallocated
Corporate Overhead Costs: Corporate Overhead Costs5 $ 675
$ 701 $ 574 $ 616
$ 855 $ 772
$
658
$ 1,950 $ 2,285 Adjusted OIBA before
Reallocation of corporate overhead costs $ 846 $ 2,214 $ 2,774 $
1,762 $ 2,212 $ 2,268
$
2,348
$ 5,834 $ 6,828 Adjusted EBITDA before Reallocation corporate
overhead costs $ 1,656 $ 3,017 $ 3,637
$ 3,533 $ 3,100 $ 3,171
$
3,256
$ 8,309 $ 9,527
Archeo1
Adjusted OIBA excluding Discontinued Operations4 and Domain Sales2
$ 3,046 $ 2,270 $ 1,720 $ 1,353 $ 886 $ 724
$
790
$ 7,036 $ 2,399 Adjusted OIBA with Domain Sales4 excluding
Discontinued Operations $ 4,510 $ 5,528
$ 2,431 $ 2,215 $ 2,246 $
2,054
$
2,676
$ 12,469 $ 6,976 Adjusted OIBA including
Discontinued Operations4 $ 3,081 $ 2,215 $ 1,662 $ 1,444 $ 849 $
735
$
719
$ 6,958 $ 2,303 Adjusted OIBA with Domain Sales4 and including
Discontinued Operations $ 4,544 $ 5,472
$ 2,375 $ 2,306 $ 2,211 $
2,065
$
2,605
$ 12,391 $ 6,881 Adjusted EBITDA excluding
Discontinued Operations4 and Domain Sales2 $ 3,293 $ 2,359 $ 1,774
$ 1,404 $ 923 $ 762
$
833
$ 7,426 $ 2,518 Adjusted EBITDA with Domain Sales4 excluding
Discontinued Operations $ 4,757 $ 5,617
$ 2,487 $ 2,266 $ 2,285 $
2,091
$
2,719
$ 12,860 $ 7,096 Adjusted EBITDA including
Discontinued Operations4 $ 3,329 $ 2,303 $ 1,718 $ 1,495 $ 888 $
773
$
761
$ 7,350 $ 2,422 Adjusted EBITDA with Domain Sales4 including
Discontinued Operations $ 4,793 $ 5,561
$ 2,430 $ 2,358 $ 2,250 $
2,102
$
2,647
$ 12,784 $ 6,999 Effect of Reallocated
Corporate Overhead Costs: Corporate Overhead Costs5 $ (675 ) $ (701
) $ (574 ) $ (616 ) $ (855 ) $ (772 )
$
(658
) $ (1,950 ) $ (2,285 ) Adjusted OIBA excluding Discontinued
Operations4 and Domain Sales2 $ 2,372 $ 1,569 $ 1,145 $ 736 $ 30 $
(48 )
$
132
$ 5,086 $ 114 Adjusted OIBA with Domain Sales4 excluding
Discontinued Operations $ 3,835 $ 4,827
$ 1,857 $ 1,599 $ 1,391 $
1,282
$
2,018
$ 10,519 $ 4,691 Adjusted OIBA including
Discontinued Operations4 $ 2,406 $ 1,514 $ 1,088 $ 828 $ (6 ) $ (37
)
$
61
$ 5,008 $ 18 Adjusted OIBA with Domain Sales4 and including
Discontinued Operations $ 3,869 $ 4,771
$ 1,801 $ 1,690 $ 1,356 $
1,293
$
1,947
$ 10,441 $ 4,596 Adjusted EBITDA excluding
Discontinued Operations4 and Domain Sales2 $ 2,618 $ 1,658 $ 1,200
$ 788 $ 68 $ (10 )
$
175
$ 5,476 $ 233 Adjusted EBITDA with Domain Sales4 excluding
Discontinued Operations $ 4,082 $ 4,916
$ 1,913 $ 1,650 $ 1,430 $
1,319
$
2,061
$ 10,910 $ 4,811 Adjusted EBITDA including
Discontinued Operations4 $ 2,654 $ 1,602 $ 1,144 $ 879 $ 33 $ 1
$
103
$ 5,400 $ 137 Adjusted EBITDA with Domain Sales4 including
Discontinued Operations $ 4,118 $ 4,860
$ 1,856 $ 1,741 $ 1,395 $
1,330
$
1,989
$ 10,834 $ 4,714 1 The financial
results for Call-Driven and Archeo are preliminary and have been
derived from the unaudited consolidated financial statements of
Marchex, Inc. for all periods presented. Corporate overhead
expenses have been reallocated in prior periods to conform to
current period presentation. The unaudited Call-Driven financial
results include certain direct operating expenses and general
corporate overhead expenses in all periods presented. The unaudited
Archeo financial results include direct operating expenses for all
periods presented. 2 In September 2013, Marchex announced and
launched its Domain Marketplace and through it, commenced buying
and selling of domains.
Domain sales occurring after this date are
included in revenue and related cost in service cost. Prior to this
date, domain sales were recognized in gain on sales and disposals
of intangible assets in the unaudited consolidated financial
statements.
3 Includes all domain sales recognized in gain on sales and
disposals of intangible assets and in revenue and service costs.
MARCHEX, INC. AND SUBSIDIARIES
Reconciliation to Reported Financial and Non-GAAP
Information (in thousands) (unaudited)
Three months ended Nine months ended
3/31/2012 6/30/2012
9/30/2012
12/31/2012 3/31/2013
6/30/2013 9/30/2013
9/30/2012 9/30/2013
Revenue
Consolidated excluding Discontinued Operations -
GAAP $ 33,835 $ 32,832 $
33,691 $ 32,436 $ 34,732
$ 37,578 $ 40,560 $
100,358 $ 112,870 Less: Domain sales
recognized in revenue3 - -
- - -
- 899 - 899
Consolidated excluding Domain Sales1 $ 33,835 $ 32,832 $
33,691 $ 32,436 $ 34,732 $ 37,578 $ 39,661 $ 100,358 $ 111,971 Add:
Domain sales recognized in revenue5 - - - - - - 899 - 899 Add:
Domain Sales1 1,474 3,270
713 863 1,362
1,330 1,047 5,457
3,739 Consolidated with Domain Sales1 35,309 36,102
34,404 33,299 36,094 38,908 41,607 105,815 116,609 Add:
Discontinued Operations6 1,646 1,182
1,130 1,554 1,481
1,441 262 3,958
3,184 Consolidated with Domain Sales
and Discontinued Operations1 $ 36,955 $ 37,284 $ 35,534 $ 34,853 $
37,575 $ 40,349 $ 41,869 $ 109,773 $ 119,793 Less: Domain sales
recognized in revenue3 - - - - - - 899 - 899 Less: Domain Sales1
1,474 3,270 713
863 1,362 1,330
1,047 5,457 3,739
Consolidated with Discontinued Operations1
and excluding Domain Sales
$ 35,481 $ 34,014 $ 34,821 $ 33,990 $ 36,213 $ 39,019 $ 39,923 $
104,316 $ 115,155 Less: Discontinued Operations 1,646 1,182 1,130
1,554 1,481 1,441 262 3,958 3,184 Archeo excluding
Domain Sales4
7,184 5,335 4,422
3,965
3,624 3,685 3,993 16,941 11,302 Other 181 175
174
181
171 162 131
530 464 Call-Driven4 $ 26,470
$ 27,322 $ 29,095 $ 28,290
$ 30,937 $ 33,731 $ 35,537 $
82,887 $ 100,205 Adjusted operating
income4 Consolidated excluding Discontinued Operations $ 3,217 $
3,784 $ 3,919 $ 2,498 $ 2,242 $ 2,220 $ 2,480 $ 10,920 $ 6,942 Add:
Gain on Domain Sales and Domain Sales Contribution7 1,463
3,258 713
862 1,362 1,330
1,886 5,434 4,578
Consolidated with Domain Sales 4,680 7,042 4,632 3,360 3,604 3,550
4,366 16,354 11,520 Add: Discontinued Operations6 35
(56 ) (57 ) 91 (36
) 10 (71 ) (78 )
(97 ) Consolidated with Domain Sales and Discontinued Operations $
4,715 $ 6,986 $ 4,575 $ 3,451 $ 3,568 $ 3,560 $ 4,295 $ 16,276 $
11,423 Less: Gain on Domain Sales and Domain Sales Contribution7
1,463 3,258 713
862 1,362 1,330
1,886 5,434 4,578
Consolidated with Discontinued Operations $ 3,252 $ 3,728 $
3,862 $ 2,589 $ 2,206 $ 2,230 $ 2,409 $ 10,841 $ 6,845 Less:
Discontinued Operations 35 (56 ) (57 ) 91 (36 ) 10 (71 ) (78 ) (97
) Archeo excluding
Domain Sales4
3,046 2,271 1,720 1,353
885
724 790 7,037
2,399
Other 71 116 104
105 106 86
75 291 267
Call-Driven4 $ 100 $ 1,397 $ 2,095
$ 1,040 $ 1,251 $ 1,410 $ 1,615
$ 3,592 $ 4,276 Adjusted EBITDA5
Consolidated excluding Discontinued Operations $ 4,273 $ 4,675 $
4,837 $
4,321
$ 3,168 $ 3,161 $ 3,431 $ 13,785 $ 9,760 Add: Gain on Domain Sales
and Domain Sales Contribution7 1,463 3,258
713 862
1,362 1,330 1,886
5,434 4,577 Consolidated with Domain
Sales 5,736 7,933 5,550
5,183
4,530 4,491 5,317 19,219 14,338 Add: Discontinued Operations6
36 (56 ) (56 ) 92
(36 ) 11 (71 ) (76
) (96 ) Consolidated with Domain Sales and
Discontinued Operations $ 5,773 $ 7,877 $ 5,493 $ 5,275 $ 4,495 $
4,501 $ 5,245 $ 19,143 $ 14,242 Less: Gain on Domain Sales and
Domain Sales Contribution7 1,463 3,258
713
863
1,362 1,330 1,886
5,434 4,578 Consolidated
with Discontinued Operations $ 4,309 $ 4,619 $ 4,781 $ 4,411 $
3,132 $ 3,172 $ 3,360 $ 13,709 $ 9,664 Less: Discontinued
Operations 36 (56 ) (56 ) 92 (36 ) 11 (71 ) (76 ) (96 ) Archeo
excluding
Domain Sales
3,293 2,359 1,774
1,404
923 762 833 7,426 2,518 Other 71 116
104 105 106
86 75 291
267 Call-Driven4 $ 909 $ 2,200 $
2,959 $ 2,812 $ 2,139 $ 2,313
$ 2,523 $ 6,068 $ 6,975 1
These are non-GAAP measures of financial results which are adjusted
for sales proceeds from sales of intangible assets, domain sales
recognized as revenue3 and/or revenue from Discontinued
Operations6. 2 Sales proceeds from sales of intangible
domain assets. 3 In September 2013, Marchex announced and launched
its Domain Marketplace and through it, commenced buying and selling
of domains.
Domain sales occurring after this date are
included in revenue and related cost in service cost. Prior to this
date, domain sales were recognized in gain on sales and disposals
of intangible assets in the unaudited condensed consolidated
financial statements.
4
The financial results for Call-Driven and
Archeo are preliminary and have been derived from the unaudited
condensed consolidated financial statements of Marchex, Inc. for
all periods presented. Corporate overhead expenses have been
reallocated in prior periods to conform to current period
presentation. The unaudited Call-Driven financial results include
certain direct operating expenses and general corporate overhead
expenses in all periods presented. The unaudited Archeo financial
results include direct operating expenses for all periods
presented.
5 These are non-GAAP measures of operating
results and liquidity. These non-GAAP measures are adjusted for net
gains from sales of intangible assets, direct contribution of
domain sales sold through Marchex's Domain Marketplace5 and/or
include operating results of Discontinued Operations6. 6
Financial results of discontinued
operations related to certain pay-per-click assets sold in July
2013 and are included in discontinued operations, net of tax in the
unaudited condensed consolidated financial statements.
7 Includes net gains from sales of intangible assets and
direct contribution of domain sales sold through Marchex's Domain
Marketplace5.
Marchex Investor RelationsTrevor Caldwell, 206-331-3600Email:
ir(at)marchex.comorMEDIA INQUIRIESMarchex Public
RelationsSonia Krishnan, 206-331-3434Email:
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Marchex (NASDAQ:MCHX)
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