Move posts Q4 net income of US$409,000 compared with net loss of US$4.5M a year ago; company reports loss of US$20.9M for full-year 2010 versus net loss of US$12.2M for 2009
February 10, 2011
– Move, Inc. (Nasdaq: MOVE), the leader in online real estate, today reported financial results for the fourth quarter and fiscal year ended December 31, 2010.
Revenue in the fourth quarter of 2010 was $48.9 million, compared to $49.6 million in the fourth quarter of 2009. Net income applicable to common stockholders, including discontinued operations, was $409,000, or $0.00 per share, compared to a net loss of $4.5 million, or a loss of $0.03 per share in the fourth quarter of 2009. The Company generated $5.0 million of cash from operating activities in the fourth quarter of 2010. Non-GAAP Adjusted EBITDA (earnings from continuing operations before interest, taxes, stock-based compensation and charges, depreciation, amortization and other non-recurring charges) for the fourth quarter of 2010 was $6.3 million, or 13% of revenue, compared to $5.1 million, or 10% of revenue, for the fourth quarter of 2009. Move, Inc. has reported Adjusted EBITDA because management uses it to monitor and assess the Company's performance and believes it is helpful to investors in understanding the Company's business.
"2010 was a year of tremendous activity at Move, as we took significant steps toward realigning our business to continue and grow our long standing market leadership," said Steve Berkowitz, chief executive officer at Move, Inc. "Move's mission is to connect real estate professionals and consumers to facilitate more real estate transactions. The increased use of the internet and mobile devices in the real estate industry has changed the ways consumers and real estate professionals interact. Move is committed to delivering products and services that meet the market's needs. As we head into 2011, we are focused on serving the complete home-buying cycle with an expanding list of distribution partners and real estate solutions."
4th Quarter 2010 Highlights:
* Market leadership: Move maintained its leading market position, leading the industry in unique users and total engagement. In 2010, on a monthly basis, the Move Network attracted an average of 11 million unique users(1) who spent on average more than 224 million minutes monthly on our network(1). Visitors to the Move Network viewed nearly 4.4 billion total pages in 2010, more than the next six competitors combined.
* MortgageMatch.com: Launched in December, MortgageMatch.com was developed to give first time buyers or refinancing owners the tools they need to find and prequalify for the right loan in as little as 10 minutes. In its first month in operation, MortgageMatch.com's state-of-the-art decision engine helped more than 30,000 prospective homebuyers know in just a few minutes how much they can afford to borrow and what their monthly payments would be based on real rates and loan choices for which they qualify.
* AOL: Move announced an agreement whereby Move will power the AOL Real Estate search experience. The agreement delivers a powerful ad network for agents and advertisers to expand their reach and visibility to AOL.com's millions of monthly visitors. The AOL Real Estate experience powered by Move will deliver a user experience customized for AOL with instant access to accurate property listings, neighborhood and school content, and connections to real estate experts. Leveraging Move's ListHub network, Move will syndicate millions of listings to AOL Real Estate and power the home buyer's search experience.
* Mobile Highlights: Move launched the Realtor.com Real Estate Search Android and Windows Phone 7 application in November, building on the success of Move's Realtor.com iPhone app launched in January. In 2010, the Realtor.com mobile apps have been downloaded over 3 million times with hundreds of thousands of consumers connecting directly with real estate professionals.
For the full year ended December 31, 2010, Move reported revenue of $197.5 million, compared to $212.0 million in the 2009 fiscal year. Net loss applicable to common stockholders in 2010 was $20.9 million, or a loss of $0.13 per share, compared to a net loss of $12.2 million, or a loss of $0.08 per share in 2009. Move's Adjusted EBITDA (earnings from continuing operations before interest, taxes, stock-based compensation and charges, depreciation, amortization and other non-recurring charges) on a non-GAAP basis for 2010 was $23.1 million, or 12% of revenue, compared to $26.2 million, or 12% of revenue, for 2009.
Move also announced today several actions designed to streamline its capital structure. First, Move announced that it reached agreement with Elevation Partners to redeem $70 million of its Series B preferred stock, leaving approximately $50 million in Series B outstanding with the same terms as before. The Company will take a charge of approximately $1.5 million in the first quarter of 2011 related to the accretion of the discount for the Series B stock redeemed. Second, the Company is proposing a one-for-four reverse stock split, whereby every four shares of Move common stock will be converted into one share. The reverse stock split requires shareholder approval which Move intends to seek at its upcoming annual shareholders meeting. And third, the Company announced that its Board of Directors has authorized a two year, $25 million stock repurchase program. The Board of Directors believes that these measures, taken together, will provide the ability to manage dilution that may occur from stock option exercises or offset dilution caused by the Series B preferred, reduce Move's carrying costs and better align itself with its peers as Move expects to create a more streamlined capital structure with reduced overhang. Under the stock repurchase program, Move may purchase stock in the open market and privately negotiated transactions, at times and in such amounts as management deems appropriate. Move is not obligated to repurchase any specific number of shares under the program and it may be limited or terminated at any time without prior notice.
Move today provided guidance for the quarter ending March 31, 2011. For the quarter ending March 31, 2011, Move expects revenue to range between approximately $48.0 million and $49.0 million and expects to report Adjusted EBITDA margin of approximately 11%.
Move today provided guidance for the year ending December 31, 2011. For the year ending December 31, 2011, Move expects revenue to range between $200 million and $205 million and expects to report Adjusted EBITDA margin of approximately 13%-14% percent.
As previously announced, Move, Inc. will host a conference call, which will be broadcast live over the Internet today, Thursday, February 10, 2011, at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time). In order to participate in the call, please dial (877) 312-5848, or if outside the U.S., (253) 237-1155, at least five minutes prior to the 1:30 p.m. PT start time. A live webcast and replay of the call will also be available at http://investor.move.com under the Events & Presentations menu. An audio replay will be available between 7:30 p.m. ET, February 10, 2011, and 11:59 p.m. ET, February 25, 2011, by calling (800) 642-1687, or (706) 645-9291, with passcode 38520820.
For additional information regarding the Company's results, please go to the "SEC Filings" section at http://investor.move.com to view our annual report as filed on March 5, 2010 with the Securities and Exchange Commission on Form 10-K for the year ended December 31, 2009. Move's Form 10-K for the year ended December 31, 2010 is expected to be filed with the Securities and Exchange Commission on, or before, February 18, 2011.
Use of Non-GAAP Financial Measures
To supplement its consolidated financial statements presented in accordance with generally accepted accounting principles in the United States ("GAAP"), Move uses a non-GAAP measure of income (loss) from continuing operations excluding interest income, net, income tax expense (benefit), impairment of auction rate securities, litigation settlement charges and restructuring charges and certain other non-cash and non-recurring items, principally depreciation, amortization and stock-based compensation and other charges, which is referred to as Adjusted EBITDA. The Company has also presented a non-GAAP table of Financial Data for the three and twelve month periods ended December 31, 2010 and 2009 that extracts stock-based compensation under ASC Topic 718 "Compensation – Stock Compensation." A reconciliation of these non-GAAP measures to GAAP is provided in the attached tables. These non-GAAP adjustments are provided to enhance the user's overall understanding of Move's current financial performance and its prospects for the future and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP. These non-GAAP measures are the primary basis management uses for planning and forecasting its future operations. Move believes these non-GAAP results provide useful information to both management and investors by excluding certain expenses that it believes are not indicative of its core operating results and a more consistent basis for comparison between quarters and should be carefully evaluated.
ABOUT MOVE, INC.
Move, Inc. (NASDAQ: MOVE) is the leader in online real estate with 12.1 million(1) monthly visitors to its online network of websites. Move, Inc. operates: Move.com, a leading destination for information on new homes and rental listings, moving, home and garden and home finance; REALTOR.com®, the official website of the National Association of REALTORS®; MortgageMatch.com, Moving.com; SeniorHousingNet; ListHub; and TOP PRODUCER Systems. Move, Inc. is based in Campbell, California.