NEW YORK - Sunday, November 11th 2012 [ME NewsWire]
Third Quarter Results
Revenue from Continuing Operations of $222 million
GAAP EPS from Continuing Operations of $0.35, includes $0.28 non-recurring tax benefit
Non-GAAP EPS from Continuing Operations of $0.09
Announces Corporate Restructuring
Concentrates resources on core business in North America and key European & Asian markets supported by increased marketing and sales
Pursues sale of ChinaHR and evaluates options in developing markets
Combined actions expected to reduce Operating Expense by approximately $130 million on an annualized basis
Review of Strategic Alternatives Ongoing
(BUSINESS WIRE)-- Monster Worldwide, Inc. (NYSE:MWW) today reported financial results for the third quarter ended September 30, 2012. The Company also announced that it will implement a corporate restructuring to focus on its core business and reduce its cost structure in order to improve profitability and cash flow.
Sal Iannuzzi, chairman, president and chief executive officer of Monster Worldwide, said, "During the third quarter, our bookings in North America, excluding the Government vertical, were up slightly, while bookings in Europe and Asia were negatively impacted by the challenging economic environment. We are implementing a plan to concentrate our resources on our largest markets where we generate the lion’s share of our revenue and profit and where we are experiencing increased customer traction with our advanced technologies. We believe this plan provides Monster the resources to grow our leading businesses in North America and Europe.”
"While our strategic alternatives review is ongoing and we remain committed to maximizing value for shareholders, today we are announcing a series of actions designed to increase the Company’s profitability and strengthen its core profitable markets,” Iannuzzi concluded.
The restructuring actions announced today include:
Pursuing a sale of ChinaHR and classifying the asset as held for sale in third quarter financial results. As a result, ChinaHR is excluded from third quarter continuing operations and prior results have been restated to reflect this change. The Company reported a non-cash asset impairment charge and deferred tax asset write-off of $225 million related to ChinaHR in the GAAP operating results.
Evaluating all options for developing markets and substantially curtailing the losses incurred in those markets.
Continuing and accelerating the redeployment of expenses into marketing and sales in Monster’s core markets, while reducing the run rate of operating expenses.
This series of actions described above is expected to reduce Monster Worldwide’s operating expense by approximately $130 million on an annualized basis. Cumulative pre-tax charges within the range of $50 million to $60 million will be recorded, of which the majority will be cash and recorded in the fourth quarter 2012. The Company anticipates the majority of these actions will occur by year end.
Third Quarter 2012 Results
As a result of the impairment charge and classification of ChinaHR as an asset held for sale, actual reported results will not be comparable to revenue and EPS guidance provided in Monster Worldwide’s August 2, 2012 second quarter earnings release. On a comparable basis, third quarter revenue and EPS are in line with previous guidance range.
Total bookings from continuing operations were $213 million, compared to $249 million in the same period a year ago. On a year over year basis, currency translation had a $7 million negative impact on bookings in the third quarter 2012. The year over year decline in total bookings is primarily attributable to continued weakness in Europe and Asia, both of which have been negatively impacted by global economic challenges, partially offset by strength in North America’s staffing and newspaper channels. Revenue from continuing operations was $222 million, compared to third quarter 2011 revenue of $249 million. On a year over year basis, currency translation had a $9 million negative impact on revenue in the third quarter 2012. Historical data on bookings and revenue from continuing operations for prior quarters is available in the Company’s supplemental financial information.
Consolidated GAAP operating expenses from continuing operations of $207 million compares to $219 million in the third quarter 2011. Net income from continuing operations for the third quarter was $39 million, or $0.35 per share, which included a $31 million or $0.28 per share non-cash tax benefit associated with the reversal of a previously recorded ASC 740 (FIN 48) tax and interest liability. In the third quarter 2011, the Company reported net income from continuing operations of $19 million, or $0.15 per share. 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.
Non-GAAP net income from continuing operations of $9.5 million, or $0.09 per share, compares to $20 million, or $0.16 per share in the third quarter 2011. Non-GAAP operating expenses of $205 million decreased 6% year over year.
Cash and cash equivalents were $175 million as of September 30, 2012 compared to $250 million as of December 31, 2011. Net operating cash flow in the quarter was $7.7 million. Deferred revenue as of September 30, 2012 was $333 million compared to $330 million as of September 30, 2011, which excludes results from ChinaHR.
Nine Months Results
Monster Worldwide reported total revenue from continuing operations of $682 million for the nine months ended September 30, 2012 compared to $761 million in the same period last year, which included $22 million from IAF’s arbitrage lead generation business and a $2.7 million purchase accounting adjustment related to the HotJobs acquisition. The Company reported GAAP earnings from continuing operations of $57 million, or $0.50 per diluted share, compared to GAAP earnings of $35 million, or $0.27 per diluted share, in the prior period.
During the third quarter 2012, Monster repurchased 1.1 million shares of its common stock at an average cost of $6.16 per share, for a total of $7 million. At September 30, 2012, there was approximately $143 million remaining under the Company’s previously announced $250 million share repurchase program.
Company Provides Q4 EPS Guidance
In light of the continued global economic weakness and actions announced today, the Company will not be providing guidance for bookings and revenues at this time. Fourth quarter EPS from continuing operations is expected to be in the range of $0.05 to $0.10. This translates into full year 2012 EPS from continuing operations to be in the range of $0.29 to $0.34.
Conference Call and Webcast
Third quarter 2012 results will be discussed on Monster Worldwide’s quarterly conference call on November 8, 2012 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) 696-1396 or (706) 758-9636 and reference conference ID 43475537.
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 at http://www.about-monster.com/sites/default/files/Q3 2012 earning slide final.pdfor 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 at http://www.about-monster.com/sites/default/files/MWWQ3FinancialSupplements.pdfor through the Company’s Investor Relations website at http://ir.monster.com.
For a replay of the conference call, please dial (855) 859-2056 or (404) 537-3406 and reference ID# 21035000. This number is valid until midnight on November 22, 2012.
About Monster Worldwide
Monster Worldwide, Inc. (NYSE: MWW), parent company of Monster®, is the worldwide leader in successfully connecting people to job opportunities. From the web, to mobile, to social, Monster helps companies find people with customized solutions using the world's most advanced technology to match the right person to the right job. With a local presence in approximately 55 countries, Monster connects employers with quality job seekers at all levels, provides personalized career advice to consumers globally and delivers vast, highly targeted audiences to advertisers. To learn more about Monster’s industry-leading products and services, visit www.monster.com. More company information is available at http://about-monster.com.
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 fourth fiscal quarter 2012 or the full 2012 fiscal year. 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-Q 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.
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Monster Worldwide, Inc.
Lori Chaitman, 212-351-7090
Andrea Rose, 212-895-8666