FriendFinder Networks Inc. Reports Financial Results for Third
Quarter 2012
SUNNYVALE, Calif., Nov. 14, 2012 /PRNewswire/ -- FriendFinder
Networks Inc. (NasdaqGM: FFN) (the "Company"), a leading internet
and technology company providing services to the rapidly expanding
markets of social networking and web-based video sharing, today
announced financial results for the third quarter and nine months
ended September 30, 2012.
"By refocusing our efforts on more effectively supporting our
dominant revenue-generating properties, FriendFinder Networks
continues to make significant operational progress.
Reflective of these efforts was a 7.5% quarter-over-quarter
and a 6.2% year-over-year improvement in Average Revenue per User
(ARPU) within the Adult segment during the third quarter," said
Anthony Previte, Chief Executive
Officer of FriendFinder Networks. "The continued
strengthening of our operational results further bolstered our
Adjusted EBITDA, which increased to $22.5
million for the third quarter, up 11.0% year-over-year and
up 33% compared to the prior quarter. We expect to see
similar levels of adjusted EBITDA going forward, supported by the
rollout of new products and enhancements in Q4 to our flagship
brands as well as the launch of a new interactive TV product that
we are very excited about."
"For the second consecutive quarter, we achieved increased
revenue contribution from Europe,
which was up 8.8% from the prior quarter. Despite the
economic weakness and uncertainty in Europe on a macro level, we successfully
executed in the region as our geographic price testing has been
positively received and renewal cycles have started to kick
in. Additionally, we experienced success in our Video
Entertainment segment which was up 4.4% year-over-year.
Overall, we are not satisfied with the declines in our overall
revenue despite the fact that the decline is mainly attributable to
our strategy of focusing on our higher margin proprietary brands;
however, increasing our overall revenues will be a focus moving
forward."
"Operationally we continue to show improvements in certain areas
of both our Adult and General Audience websites. Within the
Adult segment, conversion of members to subscribers increased to
4.9% from 4.1% in the third quarter of 2011. In addition,
Average Lifetime Net Revenue per Subscriber improved almost 24%
quarter-over-quarter. Within the General Audience segment, our
churn rate improved to 16.9%, compared with 19.6% during the same
time period last year. We also experienced a strong
improvement in the rate of decline of ending subscribers in this
segment during the quarter, which only declined 1% sequentially.
This success is primarily attributable to the consolidation of our
General Audience and Mobile segments, which has gone extremely well
and has produced numerous synergies."
Mr. Previte added, "Fines imposed by Visa USA negatively impacted our bottom line during
the quarter. Due to the Company's dependence on credit card
processing, FriendFinder Networks continues to process transactions
through Visa as we work through these issues."
"Lastly, as announced on November
5, we have retained CRT Capital Group LLC as our financial
advisor to help explore opportunities to refinance our long-term
debt. While we continue to see significant improvement in our
operating results and have adequate cash to make our excess cash
flow payment, we did not make the payment due November 5 in order to conserve cash and take
advantage of favorable market conditions to refinance our
debt. We received forbearance agreements from more than 80%
of our principal lenders to permit suspension of our required
excess cash flow payment, which was due on November 5, 2012. These agreements
recognize the strengthening of our business and signal the
continued support of our senior lenders. We will continue to
pay interest during the refinancing phase."
Third Quarter Financial Results
Revenue for the third quarter of 2012 was $77.7 million. Revenue was negatively
impacted by a decrease in affiliate based traffic and lower
resulting internet revenue as the Company continues to eliminate
lower margin co-brands.
Gross profit for the third quarter of 2012 was $52.1 million. Gross profit was negatively
impacted by the reduced revenue offset partially by reduced
affiliate expense and higher margins.
Income from operations for the third quarter of 2012 was
$17.0 million.
Loss from continuing operations for the third quarter of 2012
was ($5.7) million, or ($0.18) per share. The loss from discontinued
operations, which resulted from the closure of all JigoCity
operations, was ($2.1) million or
($0.07) per share.
Adjusted EBITDA for the third quarter of 2012 was $22.5 million.
Nine Month Financial Results:
Revenue for the nine months ended September 30, 2012 was $239.8 million.
Gross profit for the nine months ended September 30, 2012 was $153.4 million.
Income from operations for the nine months ended September 30, 2012 was $38.1 million.
Loss from continuing operations for the nine months ended
September 30, 2012 was ($26.2) million, or ($0.83) per share. The loss from
discontinued operations was ($13.6)
million or ($0.43) per
share.
Adjusted EBITDA for the nine months ended September 30, 2012 was $52.8 million.
Balance Sheet, Cash and Debt
As of September 30, 2012, the
Company had unrestricted cash and cash equivalents of $14.6 million, compared to $12.8 million at June
30, 2012. As of September 30,
2012, the Company had outstanding principal debt of
$504.4 million. Free Cash Flow
per Share was $0.45 for the third
quarter ended September 30, 2012.
The Company has received forbearance agreements from more than
80% of its senior lenders to permit suspension of its required
excess cash flow payment which was due November 5.
Conference Call Information
Management will host a conference call to discuss the results at
4:30 PM EST on Wednesday, November 14, 2012. Participants
should call 888-737-3707 (United
States/Canada) or
913-312-0720 (International).
A telephonic replay will be available for anyone unable to
participate in the live call. To access the replay, call
877-870-5176 (United
States/Canada) or
858-384-5517 (International) and enter confirmation code
9421270. The replay will be available on November 14, 2012 at 7:30
PM EST through Wednesday, November
28, 2012 at 11:59 PM EST.
Non-GAAP Financial Measures
Management believes that certain non-GAAP financial measures of
earnings before deducting net interest expense, income taxes,
depreciation and amortization, or EBITDA, and Adjusted EBITDA are
helpful financial measures as investors, analysts and others
frequently use EBITDA and Adjusted EBITDA in the evaluation of
other companies in FriendFinder Networks Inc.'s industry. For
example, these measures eliminate one-time adjustments made for
accounting purposes in connection with the Company's Various
acquisition in order to provide information that is directly
comparable to its historical and current financial
statements. For more information regarding the Company's
acquisition of Various, please refer to the section entitled
"Management's Discussion and Analysis of Financial Condition and
Results of Operations — Our History" in the Form 10-K for the year
ended December 31, 2011.
These non-GAAP financial measures may not provide information
that is directly comparable to that provided by other companies in
FriendFinder Networks Inc.'s industry, as other companies in
FriendFinder Networks Inc.'s industry may calculate such financial
measures differently, particularly as it relates to nonrecurring,
unusual items. The Company's non-GAAP financial measures of
EBITDA, Adjusted EBITDA and Free Cash Flow per Common Share are not
measurements of financial performance under GAAP and should not be
considered as alternatives to cash flow from operating activities
or as measures of liquidity or as alternatives to net income or as
indications of operating performance or any other measure of
performance derived in accordance with GAAP.
Management derived EBITDA and Adjusted EBITDA for the three and
nine months ended September 30, 2012
and 2011 using the adjustments shown in the attached reconciliation
table. Free Cash Flow per Common Share was derived by
subtracting capital expenditures and cash interest from Adjusted
EBITDA and dividing the result by the weighted average shares
outstanding for the period.
SAFE HARBOR
This press release includes "forward-looking statements" within
the meaning of the safe harbor provisions of the United States
Private Securities Litigation Reform Act of 1995. Actual
results may differ from expectations, estimates and projections
and, consequently, you should not rely on these forward looking
statements as predictions of future events. Words such as
"expect," "estimate," "project," "budget," "forecast,"
"anticipate," "intend," "plan," "may," "will," "could," "should,"
"believes," "predicts," "potential," "continue," and similar
expressions are intended to identify such forward-looking
statements. These forward-looking statements involve
significant risks and uncertainties that could cause the actual
results to differ materially from the expected results.
Additional information concerning these and other risk factors
is contained in the Company's most recent filings with the SEC,
including its Form 10-K for the year ended December 31, 2011 and its Form 10-Q for the
quarter ended September, 30, 2012. All subsequent written and
oral forward-looking statements concerning the Company are
expressly qualified in their entirety by the cautionary statements
above and subject to such risk factors discussed in the Company's
recent SEC filings. The Company cautions readers not to place
undue reliance upon any forward-looking statements, which speak
only as of the date made. The Company does not undertake or
accept any obligation or undertaking to release publicly any
updates or revisions to any forward-looking statement to reflect
any change in their expectations or any change in events,
conditions or circumstances on which any such statement is
based.
ABOUT FRIENDFINDER NETWORKS INC.
FriendFinder Networks Inc. (www.FFN.com) is an internet-based
social networking and technology company operating several of the
most heavily visited websites in the world, including
AdultFriendFinder.com, Amigos.com, AsiaFriendFinder.com, Cams.com,
FriendFinder.com, BigChurch.com and SeniorFriendFinder.com.
FriendFinder Networks Inc. also produces and distributes original
pictorial and video content and engages in brand licensing.
Investor Contact for FriendFinder Networks Inc.
Jeffrey Goldberger / Rob Fink
KCSA Strategic Communications
212.896.1206 or jgoldberger@kcsa.com / rfink@kcsa.com
Media Contact for FriendFinder Networks Inc.
Lindsay Trivento
Director, Corporate
Communications
561.912.7010 or ltrivento@ffn.com
FRIENDFINDER NETWORKS INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (IN
THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
|
|
|
September 30,
2012
|
|
|
December 31,
2011
|
|
|
|
(unaudited)
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash
|
|
$
|
14,647
|
|
|
$
|
23,364
|
|
Restricted cash
|
|
|
9,992
|
|
|
|
11,177
|
|
Accounts
receivable, less allowance for doubtful accounts of $1,063 and
$1,155, respectively
|
|
|
13,303
|
|
|
|
8,939
|
|
Inventories
|
|
|
624
|
|
|
|
822
|
|
Prepaid expenses
|
|
|
3,969
|
|
|
|
5,645
|
|
Deferred tax asset
|
|
|
4,405
|
|
|
|
4,405
|
|
Total current assets
|
|
|
46,940
|
|
|
|
54,352
|
|
Film
costs, net
|
|
|
3,928
|
|
|
|
4,105
|
|
Property
and equipment, net
|
|
|
7,046
|
|
|
|
7,830
|
|
Goodwill
|
|
|
328,061
|
|
|
|
332,292
|
|
Domain
names
|
|
|
56,360
|
|
|
|
56,093
|
|
Trademarks
|
|
|
6,613
|
|
|
|
6,613
|
|
Other
intangible assets, net
|
|
|
3,064
|
|
|
|
16,920
|
|
Unamortized debt costs
|
|
|
8,152
|
|
|
|
11,754
|
|
Other
assets
|
|
|
2,017
|
|
|
|
3,405
|
|
|
|
$
|
462,181
|
|
|
$
|
493,364
|
|
LIABILITIES
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Long-term debt which matures on September 30,
2013
and current installment of long term debt in 2011,
net of
unamortized discount of $3,273 and $260,
respectively
|
|
$
|
220,587
|
|
|
$
|
8,270
|
|
Accounts payable
|
|
|
8,313
|
|
|
|
11,324
|
|
Accrued expenses and other liabilities
|
|
|
75,317
|
|
|
|
68,930
|
|
Deferred revenue
|
|
|
37,511
|
|
|
|
42,299
|
|
Total current liabilities
|
|
|
341,728
|
|
|
|
130,823
|
|
Deferred
tax liability
|
|
|
28,310
|
|
|
|
28,310
|
|
Long-term
debt, net of unamortized discount of $21,318 and $34,170,
respectively
|
|
|
259,208
|
|
|
|
462,515
|
|
Total liabilities
|
|
|
629,246
|
|
|
|
621,648
|
|
Contingencies (Note 15)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS' DEFICIENCY
|
|
|
|
|
|
|
|
|
Preferred
stock, $0.001 par value — authorized 22,500,000 shares, none issued
and outstanding
|
|
|
|
|
|
|
|
|
Common
stock, $0.001 par value — authorized 125,000,000 shares issued and
outstanding, 32,572,761 shares at September 30, 2012
and 31,219,644 shares at December 31, 2011
|
|
|
32
|
|
|
|
31
|
|
Capital in
excess of par value
|
|
|
134,470
|
|
|
|
133,734
|
|
Accumulated deficit
|
|
|
(301,567)
|
|
|
|
(261,764)
|
|
Accumulated other comprehensive loss
|
|
|
−
|
|
|
|
(285)
|
|
Total stockholders' deficiency
|
|
|
(167,065)
|
|
|
|
(128,284)
|
|
|
|
$
|
462,181
|
|
|
$
|
493,364
|
|
FRIENDFINDER NETWORKS INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
|
|
|
|
Three
Months Ended
September 30,
|
|
|
Nine
Months Ended
September 30,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
Net
revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
Service
|
|
$
|
73,224
|
|
|
$
|
77,710
|
|
|
$
|
225,245
|
|
|
$
|
234,918
|
|
Product
|
|
|
4,500
|
|
|
|
5,026
|
|
|
|
14,568
|
|
|
|
14,709
|
|
Total
|
|
|
77,724
|
|
|
|
82,736
|
|
|
|
239,813
|
|
|
|
249,627
|
|
Cost of
revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service
|
|
|
22,141
|
|
|
|
24,267
|
|
|
|
74,904
|
|
|
|
68,547
|
|
Product
|
|
|
3,519
|
|
|
|
3,646
|
|
|
|
11,469
|
|
|
|
11,259
|
|
Total
|
|
|
25,660
|
|
|
|
27,913
|
|
|
|
86,373
|
|
|
|
79,806
|
|
Gross
profit
|
|
|
52,064
|
|
|
|
54,823
|
|
|
|
153,440
|
|
|
|
169,821
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product
development
|
|
|
2,420
|
|
|
|
4,024
|
|
|
|
10,721
|
|
|
|
12,080
|
|
Selling
and marketing
|
|
|
6,404
|
|
|
|
8,279
|
|
|
|
25,060
|
|
|
|
22,679
|
|
General
and administrative
|
|
|
21,748
|
|
|
|
22,836
|
|
|
|
66,062
|
|
|
|
67,507
|
|
Amortization of acquired intangibles and
software
|
|
|
3,707
|
|
|
|
4,060
|
|
|
|
11,120
|
|
|
|
11,906
|
|
Depreciation and other amortization
|
|
|
800
|
|
|
|
913
|
|
|
|
2,361
|
|
|
|
3,268
|
|
Total
operating expenses
|
|
|
35,079
|
|
|
|
40,112
|
|
|
|
115,324
|
|
|
|
117,440
|
|
Income
from operations
|
|
|
16,985
|
|
|
|
14,711
|
|
|
|
38,116
|
|
|
|
52,381
|
|
Interest
expense
|
|
|
(22,055)
|
|
|
|
(21,146)
|
|
|
|
(64,203)
|
|
|
|
(65,097)
|
|
Other
finance expenses
|
|
|
−
|
|
|
|
−
|
|
|
|
(500)
|
|
|
|
−
|
|
Interest
related to VAT liability not charged to customers
|
|
|
(262)
|
|
|
|
(476)
|
|
|
|
(1,004)
|
|
|
|
(1,410)
|
|
Foreign
exchange (loss) gain, principally related to VAT liability not
charged to customers
|
|
|
(463)
|
|
|
|
1,432
|
|
|
|
538
|
|
|
|
(1,521)
|
|
Gain on
liability related to warrants
|
|
|
−
|
|
|
|
−
|
|
|
|
−
|
|
|
|
391
|
|
Loss on
extinguishment of debt
|
|
|
−
|
|
|
|
−
|
|
|
|
−
|
|
|
|
(7,312)
|
|
Change in
fair value of acquisition contingent consideration
|
|
|
−
|
|
|
|
−
|
|
|
|
1,400
|
|
|
|
−
|
|
Other
non-operating expense net
|
|
|
127
|
|
|
|
1
|
|
|
|
(527)
|
|
|
|
(3,912)
|
|
Loss from
continuing operations before income tax (benefit)
|
|
|
(5,668)
|
|
|
|
(5,478)
|
|
|
|
(26,180)
|
|
|
|
(26,480)
|
|
Income tax
(benefit)
|
|
|
−
|
|
|
|
(82)
|
|
|
|
−
|
|
|
|
(5,542)
|
|
Loss from
continuing operations
|
|
$
|
(5,668)
|
|
|
$
|
(5,396)
|
|
|
$
|
(26,180)
|
|
|
$
|
(20,938)
|
|
Loss from
discontinued operations
|
|
|
(2,078)
|
|
|
|
−
|
|
|
|
(13,623)
|
|
|
|
−
|
|
Net
loss
|
|
$
|
(7,746)
|
|
|
$
|
(5,396)
|
|
|
$
|
(39,803)
|
|
|
$
|
(20,938)
|
|
Net
loss per common share — basic and diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
$
|
(0.18)
|
|
|
$
|
(0.18)
|
|
|
$
|
(0.83)
|
|
|
$
|
(1.02)
|
|
Discontinued operations
|
|
|
(0.07)
|
|
|
|
−
|
|
|
|
(0.43)
|
|
|
|
−
|
|
Net
loss
|
|
$
|
(0.25)
|
|
|
$
|
(0.18)
|
|
|
$
|
(1.26)
|
|
|
$
|
(1.02)
|
|
Weighted average shares outstanding — basic and
diluted
|
|
|
31,537
|
|
|
|
30,330
|
|
|
|
31,516
|
|
|
|
20,505
|
|
FRIENDFINDER NETWORKS INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS (IN
THOUSANDS) (UNAUDITED)
|
|
|
Nine
Months Ended
September 30,
|
|
|
|
2012
|
|
|
2011
|
|
Cash
flows from operating activities
|
|
|
|
|
|
|
Net
loss
|
|
$
|
(39,803)
|
|
|
$
|
(20,938)
|
|
Adjustment
to reconcile net loss to net cash provided by operating
activities-continuing operations:
|
|
|
|
|
|
|
|
|
Loss from
discontinued operations
|
|
|
13,640
|
|
|
|
-
|
|
Amortization of acquired intangibles and
software
|
|
|
11,120
|
|
|
|
11,906
|
|
Depreciation and other amortization
|
|
|
2,361
|
|
|
|
3,268
|
|
Amortization of film costs
|
|
|
2,213
|
|
|
|
2,141
|
|
Deferred
income tax benefit
|
|
|
−
|
|
|
|
(5,542)
|
|
Non-cash
interest, including amortization of discount and debt
costs
|
|
|
38,508
|
|
|
|
35,452
|
|
Provision
for doubtful accounts
|
|
|
368
|
|
|
|
105
|
|
Change in
value of acquisition related contingent consideration
|
|
|
(1,400)
|
|
|
|
-
|
|
Gain on
warrant liability
|
|
|
─
|
|
|
|
(391)
|
|
Loss on
extinguishment of debt
|
|
|
─
|
|
|
|
7,312
|
|
Stock
based compensation expense
|
|
|
754
|
|
|
|
2,554
|
|
Debt
costs
|
|
|
(2,312)
|
|
|
|
-
|
|
Other
|
|
|
865
|
|
|
|
590
|
|
Changes in
operating assets and liabilities:
|
|
|
|
|
|
|
|
|
Restricted
cash
|
|
|
1,055
|
|
|
|
(4,218)
|
|
Accounts
receivable
|
|
|
(4,732)
|
|
|
|
(112)
|
|
Inventories
|
|
|
198
|
|
|
|
235
|
|
Prepaid
expenses
|
|
|
(422)
|
|
|
|
(310)
|
|
Film
costs
|
|
|
(2,037)
|
|
|
|
(1,991)
|
|
Other
assets
|
|
|
96
|
|
|
|
-
|
|
Accounts
payable
|
|
|
(667)
|
|
|
|
(1,465)
|
|
Accrued
expenses and other liabilities
|
|
|
2,407
|
|
|
|
(2,972)
|
|
Deferred
revenue
|
|
|
(4,788)
|
|
|
|
(4,017)
|
|
Net cash
provided by continuing operations
|
|
|
17,424
|
|
|
|
21,607
|
|
Net cash used in discontinued operations
|
|
|
(6,979)
|
|
|
|
-
|
|
Net cash provided by operating
activities
|
|
|
10,445
|
|
|
|
21,607
|
|
Cash
flows from investing activities:
|
|
|
|
|
|
|
|
|
Purchases
of property and equipment
|
|
|
(2,813)
|
|
|
|
(4,472)
|
|
Cash paid for acquisition
|
|
|
─
|
|
|
|
(2,003)
|
|
Other
|
|
|
(267)
|
|
|
|
(49)
|
|
Net cash
used in investing activities
|
|
|
(3,080)
|
|
|
|
(6,524)
|
|
Cash
flows from financing activities:
|
|
|
|
|
|
|
|
|
Gross
proceeds from sale of common stock from initial public
offering
|
|
|
─
|
|
|
|
50,000
|
|
Payment of
underwriter discount and other offering costs in connection with
initial public offering
|
|
|
─
|
|
|
|
(6,724)
|
|
Recovery
of debt issuance costs
|
|
|
─
|
|
|
|
296
|
|
Repayment
of long-term debt
|
|
|
(16,082)
|
|
|
|
(76,770)
|
|
Net cash
used in financing activities
|
|
|
(16,082)
|
|
|
|
(33,198)
|
|
Effect of exchange rate changes on cash
|
|
|
|
|
|
|
|
|
Net
decrease in cash
|
|
|
(8,717)
|
|
|
|
(18,115)
|
|
Cash at
beginning of period
|
|
|
23,364
|
|
|
|
34,585
|
|
Cash at
end of period
|
|
$
|
14,647
|
|
|
$
|
16,470
|
|
Supplemental disclosures of cash flow
information:
|
|
|
|
|
|
|
|
|
Cash Paid
for:
|
|
|
|
|
|
|
|
|
Interest
|
|
$
|
24,673
|
|
|
$
|
29,030
|
|
Income
taxes
|
|
|
|
|
|
|
30
|
|
Non-Cash Investing and Financing
Activities:
|
|
|
|
|
|
|
|
|
Recording
of beneficial conversion feature on Non-Cash Pay Second Lien Notes
in connection with initial public offering, net of $5,660 of
related deferred taxes
|
|
|
|
|
|
|
8,490
|
|
Deferred
offering costs written off to capital in excess of par
value
|
|
|
|
|
|
|
13,267
|
|
Conversion
of Series A and B convertible preferred stock and series B common
stock to common stock
|
|
|
|
|
|
|
12
|
|
Common Stock and warrants issued and
contingent
consideration liability in connection with
acquisitions
|
|
|
|
|
|
|
8,000
|
|
Reconciliation of GAAP Net Loss to EBITDA and
Adjusted EBITDA
|
|
|
|
Unaudited
|
|
|
|
Three
Months Ended
September
30,
|
|
|
Nine
Months Ended
September
30,
|
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
|
|
(in
thousands)
|
|
GAAP net
loss
|
|
$
|
(7,746)
|
|
|
$
|
(5,396)
|
|
|
$
|
(39,803)
|
|
|
$
|
(20,938)
|
|
Add:
Interest expense, net
|
|
|
22,055
|
|
|
|
21,146
|
|
|
|
64,203
|
|
|
|
65,097
|
|
Add: Other finance expenses
|
|
|
-
|
|
|
|
-
|
|
|
|
500
|
|
|
|
-
|
|
Subtract:
Income tax benefit
|
|
|
-
|
|
|
|
(82)
|
|
|
|
-
|
|
|
|
(5,542)
|
|
Add:
Amortization of acquired intangible
assets and
software
|
|
|
3,707
|
|
|
|
4,060
|
|
|
|
11,120
|
|
|
|
11,906
|
|
Add:
Depreciation and other amortization
|
|
|
800
|
|
|
|
913
|
|
|
|
2,361
|
|
|
|
3,268
|
|
EBITDA
|
|
$
|
18,816
|
|
|
$
|
20,641
|
|
|
$
|
38,381
|
|
|
$
|
53,791
|
|
Add:
Broadstream arbitration provision,
including
related legal fees
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
7,394
|
|
Subtract/Add: (Gain)/Loss related to VAT liability
not charged to customers
|
|
|
725
|
|
|
|
(956)
|
|
|
|
466
|
|
|
|
2,931
|
|
Add: Loss
of extinguishment of debt
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
7,312
|
|
Add: Severance Expense
|
|
|
7
|
|
|
|
388
|
|
|
|
434
|
|
|
|
388
|
|
Add: Discontinued Operations
|
|
|
2,078
|
|
|
|
-
|
|
|
|
13,623
|
|
|
|
-
|
|
Add: Stock
Compensation Expense
|
|
|
347
|
|
|
|
269
|
|
|
|
803
|
|
|
|
2,554
|
|
Subtract: Change in fair value of acquisition
related contingent consideration
|
|
|
-
|
|
|
|
-
|
|
|
|
(1,400)
|
|
|
|
-
|
|
Add:
Indenture Fee
|
|
|
500
|
|
|
|
-
|
|
|
|
500
|
|
|
|
-
|
|
Adjusted
EBITDA
|
|
$
|
22,473
|
|
|
$
|
20,342
|
|
|
$
|
52,807
|
|
|
$
|
74,370
|
|
Internet Segment Historical Operating
Data
The
following table presents certain key business metrics for our adult
websites, general audience websites and live interactive video
websites for the three and nine months ended September 30, 2012 and
2011.
|
|
|
|
Three
Months Ended
September
30,
|
|
|
Nine
Months Ended
September
30,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
Adult
Websites
|
|
|
|
|
|
|
|
|
|
|
|
|
New
members
|
|
|
7,777,820
|
|
|
|
9,812,584
|
|
|
|
25,981,960
|
|
|
|
28,963,082
|
|
Beginning
subscribers
|
|
|
794,680
|
|
|
|
857,733
|
|
|
|
827,728
|
|
|
|
950,705
|
|
New
subscribers
|
|
|
383,374
|
|
|
|
406,261
|
|
|
|
1,210,680
|
|
|
|
1,210,247
|
|
Terminations
|
|
|
414,662
|
|
|
|
414,325
|
|
|
|
1,275,016
|
|
|
|
1,311,283
|
|
Ending
subscribers
|
|
|
763,392
|
|
|
|
849,669
|
|
|
|
763,392
|
|
|
|
849,669
|
|
Conversion
of members to subscribers
|
|
|
4.9
|
%
|
|
|
4.1
|
%
|
|
|
4.7
|
%
|
|
|
4.2
|
%
|
Churn
|
|
|
17.7
|
%
|
|
|
16.2
|
%
|
|
|
17.8
|
%
|
|
|
16.2
|
%
|
ARPU
|
|
$
|
22.16
|
|
|
$
|
20.86
|
|
|
$
|
21.46
|
|
|
$
|
20.24
|
|
CPGA
|
|
$
|
40.16
|
|
|
$
|
45.21
|
|
|
$
|
46.35
|
|
|
$
|
43.55
|
|
Average
lifetime net revenue per subscriber
|
|
$
|
84.75
|
|
|
$
|
83.76
|
|
|
$
|
74.17
|
|
|
$
|
81.51
|
|
Net
revenue (in millions)
|
|
$
|
51.8
|
|
|
$
|
53.4
|
|
|
$
|
153.7
|
|
|
$
|
164.0
|
|
General
Audience Websites
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New
members
|
|
|
888,129
|
|
|
|
1,463,706
|
|
|
|
3,010,530
|
|
|
|
5,050,758
|
|
Beginning
subscribers
|
|
|
38,611
|
|
|
|
48,411
|
|
|
|
44,519
|
|
|
|
53,194
|
|
New
subscribers
|
|
|
18,915
|
|
|
|
25,710
|
|
|
|
65,693
|
|
|
|
75,727
|
|
Terminations
|
|
|
19,461
|
|
|
|
27,785
|
|
|
|
72,147
|
|
|
|
82,585
|
|
Ending
subscribers
|
|
|
38,065
|
|
|
|
46,336
|
|
|
|
38,065
|
|
|
|
46,336
|
|
Conversion
of members to subscribers
|
|
|
2.1
|
%
|
|
|
1.8
|
%
|
|
|
2.2
|
%
|
|
|
1.5
|
%
|
Churn
|
|
|
16.9
|
%
|
|
|
19.6
|
%
|
|
|
19.4
|
%
|
|
|
18.4
|
%
|
ARPU
|
|
$
|
11.18
|
|
|
$
|
21.69
|
|
|
$
|
13.91
|
|
|
$
|
19.47
|
|
CPGA
|
|
$
|
24.08
|
|
|
$
|
30.10
|
|
|
$
|
40.53
|
|
|
$
|
26.83
|
|
Average
lifetime net revenue per subscriber
|
|
$
|
42.01
|
|
|
$
|
80.86
|
|
|
$
|
31.14
|
|
|
$
|
78.75
|
|
Net
revenue (in millions)
|
|
$
|
1.3
|
|
|
$
|
3.1
|
|
|
$
|
5.2
|
|
|
$
|
8.7
|
|
Live
Interactive Video Websites
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
minutes
|
|
|
8,989,717
|
|
|
|
8,781,261
|
|
|
|
27,893,863
|
|
|
|
25,991,342
|
|
Average
revenue per minute
|
|
$
|
2.18
|
|
|
$
|
2.36
|
|
|
$
|
2.32
|
|
|
$
|
2.33
|
|
Net
revenue (in millions)
|
|
$
|
19.6
|
|
|
$
|
20.7
|
|
|
$
|
64.7
|
|
|
$
|
60.7
|
|
SOURCE FriendFinder Networks Inc.