Everyday Health Reports Third Quarter 2015 Financial Results

Nov 10, 2015, 16:01 ET from Everyday Health, Inc.

NEW YORK, Nov. 10, 2015 /PRNewswire/ -- Everyday Health, Inc. (NYSE: EVDY), a leading provider of digital health marketing and communications solutions, today announced financial results for the third quarter ended September 30, 2015.

For the third quarter:

  • Total revenue grew 28% year-over-year.
  • Advertising and sponsorship revenue grew 31% year-over-year.
  • Average revenue per top 30 strategic advertiser increased 43% year-over-year.
  • Pharma revenue grew 36% year-over-year.
  • Cash flow from operations grew 29% year-over-year.

"In the third quarter, we continued to execute on our strategy to build the leading platform for healthcare marketers," said Ben Wolin, Co-Founder and CEO of Everyday Health. "With the addition of the Tea Leaves Health CRM, and the full integration of our previous acquisitions, we are well-positioned to provide a comprehensive set of solutions for our customers. Whether it's our compelling consumer content and audience, solutions for healthcare professionals or our marketing tools for hospitals and insurance providers, our business is growing and we are excited about our prospects for the future."

Financial Highlights

For the three months ended September 30, 2015:

  • Total revenue was $54.3 million, a 28% increase from the prior year period.
    • Advertising and sponsorship revenue was $49.6 million, a 31% increase from the prior year period.
    • Premium services revenue was $4.7 million, a 6% increase from the prior year period.
  • Adjusted EBITDA was $9.0 million, a 26% increase from the prior year period.
  • Net loss on a GAAP basis was $(12.7) million, compared to a net loss of $(0.1) million in the prior year period. Loss per share on a GAAP basic and diluted basis was $(0.40), compared to $(0.00) basic and diluted loss per share in the third quarter of 2014. Net income on a non-GAAP basis was $2.3 million, compared to non-GAAP net income of $2.9 million in the prior year period. Earnings per share on a non-GAAP basic and diluted basis was $0.07, compared to $0.10 and $0.09, respectively, in the third quarter of 2014. A description of the non-GAAP calculations and reconciliation to comparable GAAP measures is provided in the accompanying tables entitled "Adjusted EBITDA Reconciliation" and "Reconciliation of Non-GAAP Net Income."
  • Cash flow from operations was $7.6 million, a 29% increase from $5.9 million in the third quarter of 2014.

Financial Outlook

For the fourth quarter of 2015, the Company anticipates achieving financial results as set forth below:

Fourth Quarter of 2015

     Total Revenue

$

75.0 million

$

80.0 million

     Adjusted EBITDA

$

26.0 million 

$

29.0 million

The Company is updating its full year 2015 guidance as follows:

Full Year 2015

          Total Revenue

$

225.0 million

$

230.0 million

          Adjusted EBITDA

$

45.5 million

$

48.5 million

"Our overall growth rates on both a GAAP and pro forma basis remain strong, and we are confident in our ability to continue delivering profitable revenue growth," said Brian Cooper, CFO of Everyday Health. "We remain optimistic about our market opportunity and growth prospects, and are well-positioned to grow revenue in 2016 and further build our market leadership."

Earnings Teleconference Information

The Company will discuss its third quarter 2015 financial results and business outlook during a teleconference today, November 10, 2015, at 4:30 PM ET.  The conference call can be accessed at (877) 201-0168 or (647) 788-4901 (International), conference ID# 66790639 or via live webcast at http://ir.everydayhealth.com.

Following completion of the call, a recorded replay of the webcast will be available on Everyday Health's website.  To listen to the telephone replay, call toll-free (855) 859-2056 or (404) 537-3406 (International), conference ID# 66790639. The telephone replay will be available from 7:30 PM ET November 10, 2015 through 11:59 PM ET November 17, 2015. Additional investor information can be accessed at http://ir.everydayhealth.com.

About Everyday Health, Inc.  

Everyday Health, Inc. (NYSE: EVDY) is a leading provider of digital health marketing and communications solutions. Everyday Health attracts a large and engaged audience of consumers and healthcare professionals to its premier health and wellness properties, and utilizes its data and analytics expertise to deliver highly personalized content experiences and efficient and effective marketing and engagement solutions. Everyday Health enables consumers to manage their daily health and wellness needs, healthcare professionals to stay informed and make better decisions for their patients, and marketers, health payers and providers to communicate and engage with consumers and healthcare professionals to drive better health outcomes. Everyday Health's content and solutions are delivered through multiple channels, including desktop, mobile web, and mobile phone and tablet applications, as well as video and social media.

Safe Harbor Provision

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by their use of terms and phrases such as "anticipate," "enable," "expect," "will," "believe," "continue" and other similar terms and phrases, and such forward-looking statements include, but are not limited to, the statements regarding our future financial performance set forth under the heading "Financial Outlook." The outcome of the events described in these forward-looking statements is subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated by these forward-looking statements, including, but not limited to: our ability to attract and retain users to our portfolio of properties; our ability to attract and retain customers; the timing and amount of advertising spending by our current and future customers; our ability to effectively integrate the acquisitions that we make; our ability to enter into new, or extend existing, partnership arrangements; our ability to successfully pursue opportunities in the broader health and wellness sectors; as well as those factors contained in the "Risk Factors" section of our SEC filings. All information in this release is as of November 10, 2015. Except as required by law, we undertake no obligation to update publicly any forward-looking statement made herein for any reason to conform the statement to actual results or changes in our expectations.

Use of Non-GAAP Financial Measures

To supplement the financial measures presented in the Company's press release and related conference call or webcast in accordance with accounting principles generally accepted in the United States ("GAAP"), we also present the following non-GAAP measures of financial performance: Adjusted EBITDA, non-GAAP net income and non-GAAP net income per share ("EPS").

A "non-GAAP financial measure" refers to a numerical measure of the Company's historical or future financial performance, financial position, or cash flows that excludes (or includes) amounts that are included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP in the Company's financial statements. The Company provides certain non-GAAP measures as additional information relating to its operating results as a complement to results provided in accordance with GAAP. The non-GAAP financial information presented here should be considered in conjunction with, and not as a substitute for or superior to, the financial information presented in accordance with GAAP and should not be considered a measure of the Company's liquidity. There are significant limitations associated with the use of non-GAAP financial measures. Further, these measures may differ from the non-GAAP information, even where similarly titled, used by other companies and therefore should not be used to compare the Company's performance to that of other companies.

The Company has presented Adjusted EBITDA, non-GAAP net income and non-GAAP EPS as non-GAAP financial measures in this press release. We define Adjusted EBITDA as net loss plus: interest expense, net; income tax provision; depreciation and amortization expense; stock-based compensation expense; compensation expense related to acquisition earnout and retention bonus arrangements; write-offs of unamortized deferred financing and other debt extinguishment costs; executive transition charges; contract settlement charges; asset impairment charges; and preferred stock warrant mark-to-market adjustments. We define non-GAAP net income as net loss, plus non-cash stock-based compensation expense, compensation expense related to acquisition earnout and retention bonus arrangements, income tax provision, and other unusual or significant adjustments such as the write-off of deferred financing costs and other debt extinguishment costs, executive transition charges, contract settlement charges, asset impairment charges, and the preferred stock warrant mark-to-market adjustment. We define non-GAAP EPS as non-GAAP net income divided by weighted-average shares outstanding, which reflects the issuance of the shares sold in the Company's IPO, which closed on April 2, 2014, as well as the conversion of all outstanding shares of preferred stock into common stock in connection with the IPO.

The Company believes the use of non-GAAP financial measures, as a supplement to GAAP measures, is useful to investors in that they eliminate items that are either not part of the Company's core operations or do not require a cash outlay, such as stock-based compensation. Our management uses these non-GAAP financial measures when evaluating the Company's operating performance and for internal planning and forecasting purposes. The Company believes that these non-GAAP financial measures help indicate underlying trends in the Company's business, are important in comparing current results with prior period results, and are useful to investors and financial analysts in assessing the Company's operating performance.

 

EVERYDAY HEALTH, INC.

Consolidated Balance Sheets

(in thousands, except share and per share data)

September 30, 2015 (unaudited)

December 31, 2014

Assets

Current assets:

Cash and cash equivalents

$

35,050

$

50,729

Accounts receivable, net of allowance for doubtful accounts of $758 and $637 as 

    of September 30, 2015 and December 31, 2014, respectively

63,315

68,007

Deferred tax asset

656

656

Prepaid expenses and other current assets

6,904

5,529

Total current assets

105,925

124,921

Property and equipment, net

28,104

25,502

Goodwill

165,537

127,115

Intangible assets, net

45,253

30,716

Other assets

5,450

5,237

Total assets

$

350,269

$

313,491

Liabilities and stockholders' equity

Current liabilities:

Accounts payable and accrued expenses

$

32,153

$

31,722

Deferred revenue

9,807

6,740

Current portion of long-term debt

5,928

3,000

Other current liabilities

13,669

965

Total current liabilities

61,557

42,427

Long-term debt

105,975

87,000

Deferred tax liabilities

7,713

6,673

Other long-term liabilities

5,610

4,105

Stockholders' equity:

   Preferred stock, $0.01 par value: 10,000,000 shares authorized at September 30, 

      2015 and December 31, 2014; no shares issued and outstanding at September 

   30, 2015 and December 31, 2014

-

-

   Common stock, $0.01 par value: 90,000,000 shares authorized at September 30, 

    2015 and December 31, 2014; 32,295,614 and 31,489,196 shares issued and 

    outstanding at September 30, 2015 and  December 31, 2014, respectively

322

314

Treasury stock

(55)

(55)

Additional paid-in capital

307,329

292,117

Accumulated deficit

(138,182)

(119,090)

Total stockholders' equity

169,414

173,286

Total liabilities and stockholders' equity

$

350,269

$

313,491

 

EVERYDAY HEALTH, INC.

Consolidated Statements of Operations

(in thousands, except share and per share data, unaudited)

Three months ended 

Nine months ended

September 30,

September 30,

2015

2014

2015

2014

Revenues:

Advertising and sponsorship revenues

$

49,630

$

37,910

$

136,193

$

107,484

Premium services revenues

4,684

4,414

14,100

13,792

Total revenues

54,314

42,324

150,293

121,276

Operating expenses:

Cost of revenues

15,637

11,006

43,639

33,388

Sales and marketing

18,531

12,213

52,289

34,649

Product development

14,163

10,886

38,952

32,453

General and administrative

10,010

7,504

29,887

21,225

Total operating expenses

58,341

41,609

164,767

121,715

Income (loss) from operations

(4,027)

715

(14,474)

(439)

Interest expense, net

(1,429)

(500)

(3,808)

(2,948)

Other expense

-

-

-

(4,114)

Income (loss) from operations before provision for income taxes

(5,456)

215

(18,282)

(7,501)

Provision for income taxes

(7,262)

(365)

(810)

(1,003)

Net loss 

(12,718)

(150)

(19,092)

(8,504)

Series G preferred stock deemed dividend

-

-

-

(8,079)

Net loss attributable to common stockholders

$

(12,718)

$

(150)

$

(19,092)

$

(16,583)

Net loss attributable to common stockholders per common share - basic and diluted

$

(0.40)

$

(0.00)

$

(0.60)

$

(0.76)

Weighted-average common shares outstanding - basic and diluted

32,138,214

30,404,529

31,807,776

21,962,026

 

EVERYDAY HEALTH, INC.

Consolidated Statements of Cash Flows

(in thousands, unaudited)

Nine months ended September 30,

2015

2014

Cash flows from operating activities

Net loss

$

(19,092)

$

(8,504)

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

Depreciation and amortization

15,157

10,829

Provision for doubtful accounts

176

215

Stock-based compensation

8,216

6,748

Amortization and write-off of financing costs

396

4,309

Asset impairment charge

1,416

-

Provision for deferred income taxes

440

722

Changes in operating assets and liabilities:

Accounts receivable

9,700

7,218

Prepaid expenses and other current assets

(1,125)

316

Accounts payable and accrued expenses

(1,934)

(11,191)

Deferred revenue

2,334

1,636

Other current liabilities

1,862

(101)

Other long-term liabilities

1,724

607

Net cash provided by operating activities

19,270

12,804

Cash flows from investing activities

Additions to property and equipment, net

(10,276)

(11,326)

Proceeds from sale of business

-

400

Payments for businesses purchased, net of cash acquired

(47,316)

-

Payment of security deposits and other assets

125

90

Net cash used in investing activities

(57,467)

(10,836)

Cash flows from financing activities

Net proceeds from common stock issuance

-

70,622

Proceeds from the exercise of stock options

1,881

2,896

Repayments of principal under former revolver credit facility

-

(30,000)

Repayment of principal under former term loan facility

-

(41,333)

Borrowings under revolver credit facility

25,000

32,300

Repayment of principal under revolver credit facility

(10,000)

(32,300)

Borrowings under term loan facility

8,500

40,000

Repayment of principal under term loan facility

(1,597)

(500)

Principal payments on capital lease obligations

(521)

(480)

Tax withholdings related to net share settlements of restricted stock units

(10)

-

Payments of credit facility financing costs

(735)

(2,234)

Net cash provided by financing activities

22,518

38,971

Net increase (decrease) in cash and cash equivalents

(15,679)

40,939

Cash and cash equivalents, beginning of period

50,729

16,242

Cash and cash equivalents, end of period

$

35,050

$

57,181

 

EVERYDAY HEALTH, INC.

Adjusted EBITDA Reconciliation

(in thousands, unaudited)

Three months ended September 30,

Nine months ended September 30,

2015

2014

2015

2014

Adjusted EBITDA

$

9,000

$

7,123

$

19,513

$

17,272

Less:

Interest expense, net

1,429

500

3,808

2,948

Income tax provision

7,262

365

810

1,003

Depreciation and amortization expense

5,286

3,679

15,157

10,829

Stock-based compensation expense

2,972

2,729

8,216

6,748

Warrant mark-to-market adjustment

-

-

-

252

Compensation expense related to acquisition earnout and retention bonuses

1,628

-

4,587

135

Write-off of unamortized deferred financing costs

-

-

-

3,861

Executive transition charges

-

-

2,886

-

Contract settlement charge

1,725

-

1,725

-

Asset impairment charge

1,416

-

1,416

-

Net loss

$

(12,718)

$

(150)

$

(19,092)

$

(8,504)

 

EVERYDAY HEALTH, INC.

Reconciliation of Non-GAAP Net Income

(in thousands, except share and per share data, unaudited)

Three months ended September 30,

Nine months ended September 30,

2015

2014

2015

2014

Net loss

$

(12,718)

$

(150)

$

(19,092)

$

(8,504)

Stock-based compensation expense

2,972

2,729

8,216

6,748

Income tax provision

7,262

365

810

1,003

Warrant mark-to-market adjustment

-

-

-

252

Compensation expense related to acquisition earnout and retention bonuses

1,628

-

4,587

135

Write-off of unamortized deferred financing costs

-

-

-

3,861

Executive transition charges

-

-

2,886

-

Contract settlement charge

1,725

-

1,725

-

Asset impairment charge

1,416

-

1,416

-

Non-GAAP net income

$

2,285

$

2,944

$

548

$

3,495

Weighted-average common shares outstanding-basic

32,138,214

30,404,529

31,807,776

21,962,026

Weighted-average common shares outstanding-diluted

33,383,555

33,134,626

33,394,689

24,947,287

Non-GAAP net income per common share-basic

$

0.07

$

0.10

$

0.02

$

0.16

Non-GAAP net income per common share-diluted

$

0.07

$

0.09

$

0.02

$

0.14

 

Logo - http://photos.prnewswire.com/prnh/20101112/NY00568LOGO 

SOURCE Everyday Health, Inc.



RELATED LINKS

http://www.everydayhealth.com