- WESTON, Massachusetts, Feb. 11, 2016 /PRNewswire/ --
Monster Worldwide, Inc. (NYSE: MWW) today reported financial results for the fourth quarter and full year ended December 31, 2015.
"We are pleased to report solid improvement in earnings and cash generation consistent with our plan despite less than expected revenue for the fourth quarter. While we have much more work to do to fully implement our All the Jobs, All the People strategy, we made real progress during 2015," said Tim Yates, Chief Executive Officer of Monster. "Business trends improved on a year over year basis while new products continue to be an increasing percentage of our overall business. The progress we showed in growing the revenue and profit in our European business continued this quarter and a number of our channels in North America showed strong performance. We underperformed in North America in our transactional business as a result of competitive pressures and seasonality, as well as macro considerations in Canada. We have implemented a number of actions which we believe will improve our performance going forward, remain fully committed to revenue and cash flow growth in 2016, and expect to generate Cash EBITDA in the range of $85 million to $100 million. During the quarter, we repurchased 1.3 million shares as part of the stock buyback plan and our board has given us the flexibility to be more aggressive in implementing this program to take advantage of the current market opportunity."
Fourth Quarter 2015 Results
Revenue from continuing operations of $159.2 million decreased 6% at constant currency and 9% at actual rates compared to last year's fourth quarter. Revenue from the Company's Careers – North America operations decreased 8% year over year to $112.1 million. Revenue from Careers – International of $47.1 million was down slightly year over year at constant currency 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 America segment. Historical quarterly revenue data is available in the Company's supplemental financial information.
Total GAAP operating expenses from continuing operations decreased to $152.0 million compared to $183.3 million, excluding a $325.8 million goodwill impairment charge, in the fourth quarter of 2014. Net loss from continuing operations in the fourth quarter was $2.1 million, or $0.02 per share, compared to a loss from continuing operations of $290.9 million, or $3.33 per share, in the comparable quarter in 2014.
Non-GAAP net income from continuing operations was $10.6 million, or $0.12 per share, compared to $4.9 million, or $0.05 per share in last year's fourth quarter. Adjusted EBITDA margin of 18.1% was led by Careers – North America with a 27.7% Adjusted EBITDA 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 was $18.7 million and free cash flow was $11.4 million. Deferred revenue from continuing operations increased sequentially to $279.8 million compared to $251.1 million as of September 30, 2015. The Company ended the 2015 fourth quarter with improved total available liquidity of approximately $267.8 million compared to $156.8 million at the end of the third quarter of 2015.
Monster Social Jobs Expands to Facebook
In a separate news release today, Monster announced the expansion of Monster Social Job Ads, its programmatic social recruitment advertising platform, beyond Twitter to distribute job ads on Facebook. Monster Social Job Ads is a first-of-a-kind recruitment advertising integration with major social platforms, using exclusive professional information to target potential active and passive candidates.
Joint Venture Agreement with kununu™
Monster is also announcing today its entry into a joint venture with kununu GmbH, a subsidiary of XING AG. kununu™ is the European leader in providing employer transparency through ratings, reviews and employer branding. Initially focused on the US market, this joint venture will test the delivery of content-rich employer reviews and ratings sourced from current and former employees and candidates. This information is designed to help better inform consumers about the companies they might work for, and provides several new tools for employers to better manage their talent brands and engage prospective candidates, including sellable branding and brand management products.
Full Year 2015 Results
Monster Worldwide reported total revenue from continuing operations of $666.9 million for the twelve months ended December 31, 2015 compared to $725.6 million in the same period last year, a 4% decrease on a constant currency basis and 8% at actual rates. GAAP net income from continuing operations was $13.2 million, or $0.14 per share, compared to a loss of $293.5 million, or $3.33 per share, in 2014.
Share Repurchase Program
In the fourth quarter of 2015, the Company repurchased 1.3 million shares of the Company's common stock at a value of $8.0 million. In October 2015, the Board of Directors authorized a $75 million share repurchase program over a period of 24 months. The Company intends to repurchase shares under the new authorization as a percentage of future generated free cash flow, which can be adjusted periodically.
First quarter 2016 Non-GAAP EPS from continuing operations is expected to be in the range of $0.06 to $0.10, which excludes $2 million to $3 million of stock-based compensation and $1.2 million of non-cash debt discount amortization related to the convertible debt. Historical data on Non-GAAP EPS is available in the Company's supplemental financial information.
The Company is initiating annual Cash EBITDA guidance, which is defined as operating income excluding depreciation, amortization and stock-based compensation. The Company expects Cash EBITDA for the full year 2016 to be in the range of $85 million to $100 million.
Conference Call and Webcast
Fourth quarter 2015 results will be discussed on Monster Worldwide's quarterly conference call on February 11, 2016 at 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# 9361666. 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 at http://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# 100793397. This number is valid until midnight on February 18, 2016.
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 first quarter of 2016 and Cash EBITDA for the full year 2016. 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, income from continuing operations, income from discontinued operations, net of tax, net income, net income attributable to Monster Worldwide, Inc., and diluted earnings per share attributable to Monster Worldwide, Inc. all exclude certain pro-forma items including: non-cash stock based compensation expense; costs incurred in connection with the Company's restructuring programs; separation charges associated with the resignation of the Company's former Chief Executive Officer; non-cash impairment charges; impairment of capitalized software costs; 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; the results of our former South Korean subsidiary as it has been classified as discontinued operations; net gain recognized on the sale of our former South Korean subsidiary; 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 items 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.
Adjusted EBITDA is defined as income (loss) from continuing operations or net income (loss), as applicable, before income (loss) in equity interests, net, (benefit from) provision for income taxes, interest and other, net, gain on deconsolidation of subsidiaries, net, gain on partial sale of equity method investment, depreciation and amortization, non-cash compensation expense, non-cash impairment charges, costs incurred with the Company's restructuring programs, and the impact of the pro-forma items discussed above. The Company considers Adjusted EBITDA to be an important indicator of its operational strength which the Company believes is useful to management and investors in evaluating its operating performance. Adjusted EBITDA is a non-GAAP measure and may not be comparable to similarly titled measures reported by other companies.
Cash EBITDA is defined as income (loss) from continuing operations or net income (loss), as applicable, before income (loss) in equity interests, net, (benefit from) provision for income taxes, interest and other, net, gain on deconsolidation of subsidiaries, net, gain on partial sale of equity method investment, depreciation, amortization, non-cash compensation expense and certain non-cash impairment charges. The Company considers Cash EBITDA to be an important indicator of its operational strength which the Company believes is useful to management and investors in evaluating its operating performance. Cash EBITDA is a non-GAAP measure and may not be comparable to similarly titled measures reported by other companies.
Free cash flow is defined as cash flows 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 is 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 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 total available liquidity, among other measures, in evaluating its choices for capital deployment. Net cash and total available liquidity are presented herein as Non-GAAP measures and may not be comparable to similarly titled measures used by other companies.
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