WESTON, Massachusetts /PRNewswire/
--
Monster Worldwide, Inc. (NYSE: MWW) today reported financial
results for the second quarter and six months
ended June 30, 2015.
"Our
quarterly results exceeded our expectations as we continue to
execute our transformative strategy while improving profitability,"
said Tim
Yates, President and Chief Executive Officer. "We are
increasingly confident that our family of new strategic products
are additive to our traditional core products and provide a
superior competitive solution for our customers. Our focus on
sales execution in North America is beginning to prove effective.
Internationally, our Asia Pacific region also continues to perform
well. Europe is lagging North Americaand Asia Pacific as we continue to encounter market and
competitive headwinds. We believe that our consolidated revenue is
at or near an inflection point and we remain on track to achieve
our 18-22% EBITDA target exiting this year's fourth quarter."
During
the quarter, we had a number of important business highlights
including:
Second Quarter
2015 Results
Revenue of $180 million decreased 2% at constant currency
compared to last year's second quarter and 7% at actual rates.
Revenue in the second quarter of 2014 was $194 million. Revenue from the Company's
Careers --North America operations decreased 5%
year-over-year. Revenue from Careers – International increased 3%
at constant currency year-over-year and decreased 11% at actual
rates. As of the first quarter of 2015, Internet Advertising
& Fees revenue and operating results are being reported within
the Careers – North Americasegment. Historical quarterly revenue data
is available in the Company's supplemental financial
information.
Total
GAAP operating expenses decreased to $174 million compared to $190 million in the second quarter of 2014.
Net loss attributable to Monster for the second quarter of 2015
was $1
million, or $0.01 per share, compared to break-even in the
second quarter of 2014.
Non-GAAP net income attributable to the Company
was $9
million, or $0.10 per share, compared to $7
million, or$0.08 per share in the second quarter of 2014.
Non-GAAP operating expenses of $163 million decreased 10% year over year. Adjusted
EBITDA margin of 16% was led by Careers – North America with a 29% margin. Pro-forma
items are described in the "Notes Regarding the Use of Non-GAAP
Financial Measures" and are reconciled to the GAAP measure in the
accompanying tables.
Net
cash provided by operating activities in the quarter
was $16
million and free cash flow was $9
million. Deferred revenue declined sequentially
to $282 million or 7% compared to $304 million as of March 31, 2015. The Company ended the second
quarter with total available liquidity of
approximately $139 million.
Six Month
Results
Monster Worldwide reported total revenue of $364 million for the first six months ended
June 30, 2015 compared to $393 million in the same period last year, a 2%
decrease on a constant currency basis and 7% at actual rates. Net
income attributable to Monster was $7
million, or $0.08 per share, compared to $2
million, or $0.02 per share, in 2014.
Reallocate to
Accelerate
On February 10, 2015, the Company committed to implement a
series of cost savings initiatives to reduce costs globally while
continuing to support the Company's new strategy. The initiatives
include a global workforce reduction of approximately 300
associates, lease exit costs, impairment of certain assets, and
office and general expense controls. Through June 30, 2015, the Company has incurred $26
million of charges relating to this program. These
charges have been excluded from the Company's Non-GAAP financial
statements for the three and six months ended June 30, 2015. The Company anticipates additional charges
of approximately $2
million to $3 million in the remainder of 2015 in
connection with this program.
Guidance
Third
quarter 2015 Non-GAAP EPS from continuing operations is expected to
be in the range of $0.09 to $0.13, which excludes $3
million to $4 million of stock-based
compensation, $1.2 million of non-cash debt discount amortization
related to the convertible debt and restructuring charges related
to the Reallocate to Accelerate program.
The
Company expects to exit 2015 with a fourth quarter EBITDA margin of
between 18-22%.
Historical data on Non-GAAP EPS is available in the Company's
supplemental financial information.
Conference Call
and Webcast
Second
quarter 2015 results will be discussed on Monster Worldwide's
quarterly conference call on July 30, 2015at 8:30 AM ET. A live webcast of the conference call
can be accessed online through the Investor Relations section of
the Company's website at http://ir.monster.com. To join the
conference call by telephone, please dial (888) 317-6003 or (412)
317-6061 and reference conference ID# 1547165. A presentation of
financial slides will be referenced during the conference call and
will be viewable through the live webcast. A PDF of the
financial presentation can also be accessed directly through the
Company's Investor Relations website athttp://ir.monster.com.
The
Company has also made available certain supplemental financial
information which can be accessed directly through the Company's
Investor Relations website at http://ir.monster.com.
For a
replay of the conference call, please dial (877) 344-7529 or (412)
317-0088 and reference ID# 10069501. This number is valid
until midnight on August 7, 2015.
About Monster Worldwide
Monster Worldwide, Inc. (NYSE: MWW) is a global leader in
connecting people to jobs, wherever they are. For more than 20
years, Monster has helped people improve their lives with better
jobs, and employers find the best talent. Today, the company offers
services in more than 40 countries, providing some of the broadest,
most sophisticated job seeking, career management, recruitment and
talent management capabilities. Monster continues its pioneering
work of transforming the recruiting industry with advanced
technology using intelligent digital, social and mobile solutions,
including our flagship website monster.com® and a vast array of
products and services. For more information visit http://monster.com/about.
Special Note: The
statements in this release that are not strictly historical,
including, without limitation, statements regarding the Company's
strategic direction, prospects and future results, constitute
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. Such forward-looking statements involve certain risks
and uncertainties and, therefore, actual results may differ
materially from what is expressed or implied herein and no
assurance can be given that the Company will achieve, among other
things, its outlook with respect to earnings per share for the
third quarter 2015 and EBITDA margin for the fourth quarter 2015.
Factors that could cause results to differ materially from those
expressed or implied by such forward-looking statements include,
but are not limited to, economic and other conditions in the
markets in which we operate, risks associated with acquisitions or
dispositions, competition, and the other risks discussed in our
Form 10-K and our other filings made with the Securities and
Exchange Commission, which discussions are incorporated into this
release by reference. Many of the factors that will determine the
Company's future results are beyond the ability of management to
control or predict. Readers should not place undue reliance on the
forward-looking statements in this release as they reflect
management's views only as of the date hereof. The Company
undertakes no obligation to revise or update any of the
forward-looking statements contained in this release or to make any
other forward-looking statements, whether as a result of new
information, future events or otherwise.
Notes Regarding the Use of Non-GAAP Financial
Measures
The
Company has provided certain Non-GAAP financial information as
additional information for its operating results. These measures
are not in accordance with, or an alternative for, generally
accepted accounting principles ("GAAP") and may be different from
Non-GAAP measures reported by other companies. The Company believes
that its presentation of Non-GAAP measures provides useful
information to management and investors regarding certain financial
and business trends relating to its financial condition and results
of operations.
Non-GAAP revenue, operating expenses, operating income, operating
margin, net income, and diluted earnings per share attributable to
Monster Worldwide, Inc. all exclude certain pro-forma adjustments
including: non-cash stock based compensation expense; separation
charges associated with the resignation of the Company's former
Chief Executive Officer; costs incurred in connection with the
Company's restructuring programs; non-cash impairment charges;
amortization of the debt discount and deferred financing costs
associated with our 3.50% convertible senior notes due 2019;
write-off of deferred financing costs relating to our former credit
facility, amended in October 2014; income tax benefits associated with the
reversal of income tax reserves on uncertain tax positions and a
tax benefit related to certain losses arising from the Company's
restructuring programs; income tax provisions for increased
valuation allowances on deferred tax assets; gain on
deconsolidation of subsidiaries and tax provisions thereon; gain on
partial sale of an equity method investment and tax provisions
thereon; and charges related to exited facilities.
In the
first quarter of the calendar year 2015, the Company began to
utilize a fixed long-term projected Non-GAAP tax rate for reporting
operating results and for planning, forecasting, and analyzing
future periods. This change provides better consistency
across the interim reporting periods by eliminating the effects of
non-recurring and period-specific items. When projecting this
long-term rate, the Company evaluated a five-year financial
projection comprising the current and the next four years that
exclude the income tax effects of the Non-GAAP pre-tax adjustments
described above, eliminates the effects of non-recurring and period
specific items which can vary in size and frequency, and is
reflective of the anticipated future geographic mix of income among
tax jurisdictions. The projected rate also assumes no new
acquisitions or disposals in the five-year period, eliminates the
effect of tax valuation allowances, and takes into account other
factors including the Company's current tax structure, its existing
tax positions in various jurisdictions and key legislation in major
jurisdictions where the Company operates. The Non-GAAP tax
rate is 35%. The Company intends to re-evaluate this long-term rate
on an annual basis or if any significant events that may materially
affect this long-term rate occur. This long-term rate could be
subject to change for a variety of reasons, which may include (but
are not limited to) for example, significant changes in the
geographic earnings mix including future acquisition or disposition
activity, having less income than anticipated, or fundamental tax
law changes in major jurisdictions where the Company operates.
Non-GAAP diluted shares includes the impact, based on the average
share price for the period, of the Company's outstanding capped
call transactions, which are anti-dilutive in GAAP earnings per
share, but are expected to mitigate the dilutive effect of the
Company's 3.50% convertible senior notes due 2019.
The
Company uses these Non-GAAP measures for reviewing the ongoing
results of the Company's core business operations and in certain
instances, for measuring performance under certain of the Company's
incentive compensation plans. These Non-GAAP measures may not be
comparable to similarly titled measures reported by other
companies.
Earnings before interest, taxes, depreciation and amortization
("EBITDA") is defined as operating income or loss before
depreciation and amortization, non-cash compensation expense,
non-cash impairment charges, and non-cash costs incurred in
connection with the Company's restructuring programs. Adjusted
EBITDA excludes the impact of the pro-forma adjustments discussed
above. The Company considers EBITDA and Adjusted EBITDA to be
important indicators of its operational strength which the Company
believes are useful to management and investors in evaluating its
operating performance. EBITDA and Adjusted EBITDA are Non-GAAP
measures and may not be comparable to similarly titled measures
reported by other companies.
Free
cash flow is defined as cash flow from operating activities less
capital expenditures. Free cash flow is considered a liquidity
measure and provides useful information about the Company's ability
to generate cash after investments in property and equipment. Free
cash flow reflected herein is a Non-GAAP measure and may not be
comparable to similarly titled measures reported by other
companies. Free cash flow does not reflect the total change in the
Company's cash position for the period and should not be considered
a substitute for such a measure.
Net
cash and securities are defined as cash and cash equivalents plus
short-term and long-term marketable securities, less total debt.
Total available liquidity is defined as cash and cash equivalents,
plus short-term and long-term marketable securities, plus unused
borrowings under our credit facility. The Company considers net
cash and securities and total available liquidity to be important
measures of liquidity and indicators of its ability to meet its
ongoing obligations. The Company also uses net cash and securities
and total available liquidity, among other measures, in evaluating
its choices for capital deployment. Net cash and securities and
total available liquidity are presented herein as Non-GAAP measures
and may not be comparable to similarly titled measures used by
other companies.
MONSTER
WORLDWIDE, INC.
UNAUDITED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in
thousands, except per share amounts)
Three
Months Ended June 30,
Six Months
Ended June 30,
2015
2014
2015
2014
Revenue
$
180,414
$
194,441
$
364,107
$
392,590
Salaries and
related
89,915
103,220
183,661
205,219
Office and
general
44,270
49,131
90,312
104,338
Marketing and
promotion
34,240
37,377
67,401
78,790
Restructuring and
other special charges
5,977
-
26,199
-
Total operating
expenses
174,402
189,728
367,573
388,347
Operating
income (loss)
6,012
4,713
(3,466)
4,243
Gain on partial
sale of equity method investment
-
-
8,849
-
Gain on
deconsolidation of subsidiaries, net
-
-
-
11,828
Interest and other,
net
(3,350)
(1,660)
(6,457)
(2,983)
Income (loss)
before income taxes and income (loss) in equity
interests
2,662
3,053
(1,074)
13,088
Provision for
(benefit from) income taxes
2,816
1,615
(10,329)
8,278
Income (loss) in
equity interests, net
292
58