EX-99.1 2 y13983exv99w1.txt PRESS RELEASE EXHIBIT 99.1 MARTHA STEWART LIVING OMNIMEDIA, INC. ANNOUNCES THIRD QUARTER 2005 RESULTS NEW YORK, NEW YORK, OCTOBER 27, 2005 -- Martha Stewart Living Omnimedia, Inc. (NYSE: MSO) announced its results today for the third quarter of 2005. Revenues for the third quarter of 2005 were $40.9 million, compared to $38.7 million in the prior year's quarter. Operating income before depreciation and amortization, and non-cash equity compensation ("OIDA") for the third quarter of 2005 was a loss of $(11.5) million, compared to an OIDA loss of $(13.5) million in the same period last year. Operating loss for the third quarter was $(26.9) million, compared to an operating loss of $(16.2) million for the third quarter of 2004. Loss per share from continuing operations was $(0.51) for the third quarter of 2005, compared to a loss per share from continuing operations of $(0.30) in the third quarter of 2004. The current period results include a $10.8 million ($0.21 per share) non-cash charge related to the vesting of certain warrants granted in connection with the airing of "The Apprentice: Martha Stewart," a show in which we have no economic interest, but which provides great promotional value. Susan Lyne, President and Chief Executive Officer, said: "With new initiatives underway in every area of the business, the revitalization of MSLO is firmly underway. Third quarter earnings were modestly ahead of expectation, largely on the strength of our core Publishing business. Direct mail response rates are at record high levels, and we are increasing the rate base of our flagship magazine Martha Stewart Living, effective with the January 2006 issue. Correspondingly, high renewal rates confirm the enduring bond with our expanding audience of readers. Advertising continued to rebound in the quarter, with Martha Stewart Living's pages up 48%. Fourth quarter ad pages are currently expected to double, and advertising commitments for 2006 are very strong." Initial viewer response to our new daily syndicated television show, `MARTHA,' has been strong, though ratings for the first five weeks were below our expectations. With a clearer sense of what viewers respond to, we are tweaking the format and promotion to drive more consistent ratings. Recent trends confirm our modifications: the past two weeks saw increases in both households and demo ratings; however, both remain below our budgeted expectations. "We continue to make investments necessary to support future growth, including costs incurred in connection with new agreements with KB Home, Sirius Satellite Radio, and Warner Home Video. Overall, we had a very productive summer and early fall and we are all energized by the launch of new products and new businesses. We expect that our results will show strong year-over-year improvement in the fourth quarter and for the full year." THIRD QUARTER 2005 RESULTS BY SEGMENT PUBLISHING Revenues in the third quarter of 2005 were $27.6 million, compared to $22.2 million in the third quarter of 2004, an increase of 24%. Adjusting for Body + Soul, which was acquired in August 2004, revenue increased 18%. The revenue growth was driven by higher advertising revenue in both Martha Stewart Living and Everyday Food. Advertising pages in Martha Stewart Living increased 48% in the quarter, ahead of our previous guidance of 35%. Everyday Food also showed strong growth in the quarter, increasing advertising pages by 21%. Both titles produced higher revenue per page as well. We currently expect the strong growth in ad pages and revenue to continue throughout the remainder of 2005 and for the full year 2006. Based on current trends, we expect fourth quarter advertising pages in Martha Stewart Living to double year-over-year, resulting in a significant improvement in segment results. Circulation trends continue to be strong, with renewal and new subscriber response rates at record highs. OIDA loss was $(1.9) million, compared to a loss of $(5.4) million in the third quarter of 2004. Operating loss was $(2.5) million for the third quarter of 2005, compared to an operating loss of $(5.6) million in the third quarter of 2004. TELEVISION Revenues in the third quarter of 2005 were $3.4 million, compared to $2.2 million in the third quarter of 2004. The quarter included three weeks of contribution from our new syndicated daily show, which launched on September 12, 2005. While the initial ratings of the show are strong, with a season-to-date household rating of 1.7 and upward trends in the last two weeks, they are below our original expectations. It is worth noting that other parts of the business have benefited from the launch. Our web traffic has increased 50% over the same period one year ago, online magazine subscription sales are up dramatically and sales of our Martha Stewart Everyday products at Kmart since the September 12 launch have improved as well. OIDA was a loss of $(3.0) million for the third quarter of 2005, compared to a loss of $(1.8) million in the prior year's third quarter. Operating loss for the third quarter of 2005 was $(3.5) million, compared to an operating loss of $(1.8) million in the third quarter of 2004. MERCHANDISING Revenues in the third quarter of 2005 were $8.3 million, compared to $8.0 million in the third quarter of 2004. The revenue increase was principally related to payments from our program with Sears Canada. Sales of our Martha Stewart Everyday products at Kmart declined in the quarter, with weakness in soft home partially offset by sales related to our recently introduced furniture line - Everyday Rooms. The decline in royalty revenue from sales at Kmart in the quarter will not impact full-year results from operations, as we currently receive guaranteed annual amounts. OIDA was $4.3 million in the current period, compared to $4.9 million in the prior year's quarter. OIDA was negatively impacted by higher costs in the quarter related to increases in staffing as we invest to support our new product launches. Third-quarter 2005 operating income was $4.1 million, compared to $4.8 million in the third quarter of 2004. INTERNET/DIRECT COMMERCE Revenues in the third quarter of 2005 were $1.6 million, compared to $6.2 million in the same period a year ago. Revenue in the current quarter principally reflects our online flower business. Advertising revenue also increased in the quarter, representing a high-margin growth opportunity for the company. Total revenue would have increased 48% in the quarter excluding the results of the catalog operation, which was closed earlier this year. OIDA was a loss of $(0.7) million in the third quarter of 2005, compared to a loss of $(2.4) million in the third quarter of 2004. Operating loss was $(1.0) million for the third quarter of 2005, compared to an operating loss of $(2.7) million in the third quarter of 2004. CORPORATE EXPENSES Corporate expenses, before depreciation and amortization and non-cash equity compensation, were $10.2 million in third quarter of 2005 compared to $8.8 million in the third quarter of 2004. The increase in corporate expenses is related to professional fees associated with recruiting new management as well as other costs associated with developing new product ideas and consumer research. Corporate expenses, including depreciation and amortization and non-cash equity compensation, were $23.9 million, compared to $10.9 million in the prior year's quarter. Higher levels of non-cash equity compensation in the current year's quarter principally relate to the vesting of certain warrants granted in connection with the airing of "The Apprentice: Martha Stewart." TRENDS AND OUTLOOK James Follo, Chief Financial and Administrative Officer, commented: "We currently expect revenues in the fourth quarter of 2005 to be approximately $80 million, OIDA to be approximately $11 million and operating income to be approximately break-even. These results will reflect significant revenue growth in publishing principally due to higher advertising revenues, and in television principally due to the revenues from the `MARTHA' program. Operating results will reflect significant year-over-year improvement, principally in publishing and merchandising, offset by higher corporate expenses principally due to higher consulting and professional fees." USE OF NON-GAAP FINANCIAL INFORMATION The Company believes OIDA, a non-GAAP financial measure, is an appropriate measure when evaluating the operating performance of its business segments and the Company on a consolidated basis. OIDA is used externally by the Company's investors, analysts, and industry peers. OIDA is among the primary metrics used by management for the planning and forecasting of future periods, and is considered an important indicator of the operational strength of the Company's businesses. The Company believes the presentation of this measure is relevant and useful for investors because it allows investors to view performance in a manner similar to the method used by the Company's management and makes it easier to compare the Company's results with other companies that have different capital structures or tax rates. The Company believes OIDA should be considered in addition to, not as a substitute for, operating income (loss), net income (loss), cash flows, and other measures of financial performance prepared in accordance with generally accepted accounting principles ("GAAP"). As OIDA is not a measure of performance calculated in accordance with GAAP, this measure may not be comparable to similarly titled measures employed by other companies. A reconciliation of OIDA to operating income (loss) is provided in the financial statements included with this release. Martha Stewart Living Omnimedia, Inc. (MSLO) is a leading provider of original "how-to" information, inspiring and engaging consumers with unique lifestyle content and high-quality products. MSLO is organized into four business segments: Publishing, Television, Merchandising, and Internet/Direct Commerce. Martha Stewart Living Omnimedia, Inc. is listed on the New York Stock Exchange under the ticker symbol MSO. The Company will host a conference call with analysts and investors at 12:00 p.m. EDT that will be broadcast live over the Internet at www.marthastewart.com/ir. ### We have included in this press release certain "forward-looking statements," as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not historical facts but instead represent only our current beliefs regarding future events, many of which, by their nature, are inherently uncertain and outside of our control. These statements can be identified by terminology such as "may," "will," "should," "could", "expects," "intends," "plans," "anticipates," "believes," "estimates," "potential" or "continue" or the negative of these terms or other comparable terminology. The Company's actual results may differ materially from those projected in these statements, and factors that could cause such differences include: adverse reactions to publicity relating to Martha Stewart by consumers, advertisers and business partners; an adverse resolution to the pending SEC enforcement proceeding against Ms. Stewart arising from her personal sale of non-Company stock; adverse resolution of some or all of the Company's ongoing litigation; downturns in national and/or local economies; shifts in our business strategies; a loss of the services of Ms. Stewart; a loss of the services of other key personnel; a softening of the domestic advertising market; changes in consumer reading, purchasing and/or television viewing patterns; unanticipated increases in paper, postage or printing costs; operational or financial problems at any of our contractual business partners; the receptivity of consumers to our new product introductions; and changes in government regulations affecting the Company's industries. Certain of these and other factors are discussed in more detail in the Company's filings with the Securities and Exchange Commission, especially under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations", which may be accessed through the SEC's World Wide Web site at http://www.sec.gov. The Company is under no obligation to update any forward-looking statements after the date of this release. CONTACT: Investors - Howard Hochhauser, VP Finance and Investor Relations of Martha Stewart Living Omnimedia, Inc., 212-827-8530; Media - Elizabeth Estroff, AVP, Corporate Communications, of Martha Stewart Living Omnimedia, Inc., 212-389-4444. Martha Stewart Living Omnimedia, Inc. Consolidated Statements of Operations Three Months Ended September 30, (in thousands, except per share amounts)
2005 2004 % change -------- -------- -------- REVENUES Publishing $ 27,564 $ 22,235 24.0% Television 3,395 2,203 54.1% Merchandising 8,340 8,014 4.1% Internet/Direct Commerce 1,555 6,201 -74.9% -------- -------- -------- Total Revenues 40,854 38,653 5.7% -------- -------- -------- OPERATING COSTS AND EXPENSES Production, distribution and editorial 23,387 27,405 14.7% Selling and promotion 13,418 12,473 -7.6% General and administrative 15,553 12,272 -26.7% Non-cash equity compensation 13,275 990 nm Depreciation and amortization 2,075 1,667 -24.5% -------- -------- -------- Total operating costs and expenses 67,708 54,807 -23.5% -------- -------- -------- OPERATING LOSS (26,854) (16,154) -66.2% Interest income, net 1,033 511 102.2% -------- -------- -------- LOSS BEFORE INCOME TAXES (25,821) (15,643) -65.1% Income tax benefit (provision) (125) 806 -115.5% -------- -------- -------- LOSS FROM CONTINUING OPERATIONS BEFORE LOSS FROM DISCONTINUED OPERATIONS (25,946) (14,837) -74.9% -------- -------- -------- Loss from discontinued operations (122) (129) 5.4% -------- -------- -------- NET LOSS $(26,068) $(14,966) -74.2% ======== ======== ======== LOSS PER SHARE -- BASIC AND DILUTED Loss from continuing operations $ (0.51) $ (0.30) Loss from discontinued operations (0.00) (0.00) -------- -------- Net loss $ (0.51) $ (0.30) ======== ======== WEIGHTED AVERAGE COMMON SHARES OUTSTANDING Basic and Diluted 50,849 49,698
1 Martha Stewart Living Omnimedia, Inc. Segment Information Three Months Ended September 30, (in thousands)
2005 2004 % change -------- -------- -------- REVENUES Publishing $ 27,564 $ 22,235 24.0% Television 3,395 2,203 54.1% Merchandising 8,340 8,014 4.1% Internet/Direct Commerce 1,555 6,201 -74.9% -------- -------- -------- Total Revenues 40,854 38,653 5.7% -------- -------- -------- OPERATING INCOME (LOSS) BEFORE DEPRECIATION AND AMORTIZATION AND NON-CASH EQUITY COMPENSATION Publishing (1,877) (5,402) 65.3% Television (3,047) (1,765) -72.6% Merchandising 4,344 4,897 -11.3% Internet/Direct Commerce (723) (2,437) 70.3% -------- -------- -------- Operating Loss before Depreciation and Amortization (1,303) (4,707) 72.3% and Corporate Expense and Non-Cash Equity Compensation Corporate Expense (10,201) (8,790) -16.1% -------- -------- -------- Operating Loss before Depreciation and Amortization and Corporate Expense and Non-Cash Equity Compensation (11,504) (13,497) 14.8% Non-cash equity compensation (13,275) (990) nm Depreciation and amortization (2,075) (1,667) -24.5% -------- -------- -------- OPERATING LOSS (26,854) (16,154) -66.2% Interest income, net 1,033 511 102.2% -------- -------- -------- LOSS BEFORE INCOME TAXES (25,821) (15,643) -65.1% Income tax (provision) benefit (125) 806 -115.5% -------- -------- -------- LOSS FROM CONTINUING OPERATIONS BEFORE LOSS FROM DISCONTINUED OPERATIONS (25,946) (14,837) -74.9% -------- -------- -------- Loss from discontinued operations (122) (129) 5.4% -------- -------- -------- NET LOSS $(26,068) $(14,966) -74.2% ======== ======== ========
2 Martha Stewart Living Omnimedia, Inc. Consolidated Statements of Operations Nine Months Ended September 30, (in thousands, except per share amounts)
2005 2004 % change --------- --------- --------- REVENUES Publishing $ 84,626 $ 69,905 21.1% Television 6,039 9,436 -36.0% Merchandising 27,894 29,706 -6.1% Internet/Direct Commerce 6,912 18,179 -62.0% --------- --------- --------- Total Revenues 125,471 127,226 -1.4% --------- --------- --------- OPERATING COSTS AND EXPENSES Production, distribution and editorial 71,755 86,757 17.3% Selling and promotion 46,162 38,845 -18.8% General and administrative 45,148 43,698 -3.3% Non-cash equity compensation 37,770 3,469 nm Depreciation and amortization 5,482 4,976 -10.2% --------- --------- --------- Total operating costs and expenses 206,317 177,745 -16.1% --------- --------- --------- OPERATING LOSS (80,846) (50,519) -60.0% Interest income, net 2,692 1,192 125.8% --------- --------- --------- LOSS BEFORE INCOME TAXES (78,154) (49,327) -58.4% Income tax provision (207) (2,526) 91.8% --------- --------- --------- LOSS FROM CONTINUING OPERATIONS BEFORE LOSS FROM DISCONTINUED OPERATIONS (78,361) (51,853) -51.1% --------- --------- --------- Loss from discontinued operations (374) (417) 10.3% --------- --------- --------- NET LOSS $ (78,735) $ (52,270) -50.6% ========= ========= ========= LOSS PER SHARE -- BASIC AND DILUTED Loss from continuing operations $ (1.54) $ (1.05) Loss from discontinued operations (0.01) (0.01) --------- --------- Net loss $ (1.55) $ (1.05) ========= ========= WEIGHTED AVERAGE COMMON SHARES OUTSTANDING Basic and Diluted 50,959 49,578
3 Martha Stewart Living Omnimedia, Inc. Segment Information Nine Months Ended September 30, (in thousands except per share amounts)
2005 2004 % change --------- --------- --------- REVENUES Publishing $ 84,626 $ 69,905 21.1% Television 6,039 9,436 -36.0% Merchandising 27,894 29,706 -6.1% Internet/Direct Commerce 6,912 18,179 -62.0% --------- --------- --------- Total Revenues 125,471 127,226 -1.4% --------- --------- --------- OPERATING INCOME (LOSS) BEFORE DEPRECIATION AND AMORTIZATION AND NON-CASH EQUITY COMPENSATION Publishing (12,164) (12,880) 5.6% Television (7,872) (7,127) -10.5% Merchandising 16,719 17,106 -2.3% Internet/Direct Commerce (2,868) (7,050) 59.3% --------- --------- --------- Operating Loss before Depreciation and Amortization (6,185) (9,951) 37.8% and Corporate Expense and Non-Cash Equity Compensation Corporate Expense (31,409) (32,123) 2.2% --------- --------- --------- Operating Loss before Depreciation and Amortization and Non- Cash Equity Compensation (37,594) (42,074) 10.6% Non-cash equity compensation (37,770) (3,469) nm Depreciation and amortization (5,482) (4,976) -10.2% --------- --------- --------- OPERATING LOSS (80,846) (50,519) -60.0% Interest income, net 2,692 1,192 125.8% --------- --------- --------- LOSS BEFORE INCOME TAXES (78,154) (49,327) -58.4% Income tax provision (207) (2,526) 91.8% --------- --------- --------- LOSS FROM CONTINUING OPERATIONS BEFORE LOSS FROM DISCONTINUED OPERATIONS (78,361) (51,853) -51.1% --------- --------- --------- Loss from discontinued operations (374) (417) 10.3% --------- --------- --------- NET LOSS $ (78,735) $ (52,270) -50.6% ========= ========= =========
4 Martha Stewart Living Omnimedia, Inc. Consolidated Balance Sheets (in thousands, except per share amounts)
September 30, December 31, 2005 2004 ---- ---- ASSETS CURRENT ASSETS Cash and cash equivalents $ 31,244 $ 104,647 Short-term investments 90,798 35,309 Accounts receivable, net 20,318 31,332 Inventories, net 4,838 5,229 Deferred television production costs 6,132 -- Income taxes receivable 5,107 6,321 Other current assets 5,278 3,573 --------- --------- TOTAL CURRENT ASSETS 163,715 186,411 PROPERTY, PLANT AND EQUIPMENT, net 18,368 17,175 INTANGIBLE ASSETS, net 53,827 54,264 OTHER NONCURRENT ASSETS 5,977 6,828 --------- --------- TOTAL ASSETS $ 241,887 $ 264,678 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable and accrued liabilities $ 27,589 $ 25,604 Accrued payroll and related costs 9,599 9,407 Income taxes payable 365 412 Current portion of deferred subscription income 30,100 27,160 Current portion of deferred revenue 4,881 -- --------- --------- TOTAL CURRENT LIABILITIES 72,534 62,583 --------- --------- DEFERRED SUBSCRIPTION INCOME 7,545 7,668 DEFERRED REVENUE 3,903 3,438 OTHER NONCURRENT LIABILITIES 3,088 3,361 --------- --------- TOTAL LIABILITIES 87,070 77,050 --------- --------- COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY Class A common stock, $0.01 par value, 350,000 shares authorized: 24,637 and 21,660 shares outstanding in 2005 and 2004, respectively 246 217 Class B common stock, $0.01 par value, 150,000 shares authorized: 26,873 and 29,123 shares outstanding in 2005 and 2004, respectively 269 291 Capital in excess of par value 251,380 196,781 Unamortized restricted stock (11,475) (2,793) Accumulated deficit (84,828) (6,093) --------- --------- 155,592 188,403 Less class A treasury stock - 59 shares at cost (775) (775) --------- --------- TOTAL SHAREHOLDERS' EQUITY 154,817 187,628 --------- --------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 241,887 $ 264,678 ========= =========
5 Martha Stewart Living Omnimedia, Inc. Supplemental Disclosures Regarding Non-GAAP Financial Information Three Months Ended September 30, (in thousands) The following table presents segment and consolidated financial information, including a reconciliation of operating income, a GAAP measure, and Operating Income before Depreciation and Amortization, including non-cash equity compensation, (OIDA), a non-GAAP measure. In order to reconcile OIDA to operating income, depreciation and amortization and non-cash equity compensation are added back to operating income.
2005 2004 % change ---- ---- -------- OPERATING INCOME (LOSS) Publishing $ (2,544) $ (5,576) 54.4% Television (3,537) (1,822) -94.1% Merchandising 4,055 4,805 -15.6% Internet/Direct Commerce (963) (2,685) 64.1% -------- -------- ------ Operating Loss before Corporate Expenses (2,989) (5,278) 43.4% Corporate Expense (23,865) (10,876) -119.4% -------- -------- ------ TOTAL OPERATING LOSS (26,854) (16,154) -66.2% -------- -------- ------ DEPRECIATION AND AMORTIZATION Publishing 247 149 -65.8% Television 462 57 -710.5% Merchandising 211 189 -11.6% Internet/Direct Commerce 231 248 6.9% Corporate Expense 924 1,024 9.8% -------- -------- ------ TOTAL DEPRECIATION AND AMORTIZATION 2,075 1,667 -24.5% -------- -------- ------ NON-CASH EQUITY COMPENSATION Publishing 420 25 Nm Television 28 -- Nm Merchandising 78 (97) Nm Internet/Direct Commerce 9 -- Nm Corporate Expense 12,740 1,062 Nm -------- -------- ------ TOTAL NON-CASH EQUITY COMPENSATION 13,275 990 Nm -------- -------- ------ OPERATING INCOME (LOSS) BEFORE DEPRECIATION AND AMORTIZATION AND NON-CASH EQUITY COMPENSATION Publishing (1,877) (5,402) 65.3% Television (3,047) (1,765) -72.6% Merchandising 4,344 4,897 -11.3% Internet/Direct Commerce (723) (2,437) 70.3% -------- -------- ------ Operating Loss before Depreciation and Amortization, Non-Cash Equity Compensation and Corporate Expenses (1,303) (4,707) 72.3% Corporate Expense (10,201) (8,790) -16.1% -------- -------- ------ TOTAL OPERATING LOSS BEFORE DEPRECIATION AND AMORTIZATION AND NON-CASH EQUITY COMPENSATION $(11,504) $(13,497) 14.8% ======== ======== ======
6 Martha Stewart Living Omnimedia, Inc. Supplemental Disclosures Regarding Non-GAAP Financial Information Nine Months Ended September 30, (in thousands) The following table presents segment and consolidated financial information, including a reconciliation of operating income, a GAAP measure, and Operating Income before Depreciation and Amortization, including non-cash equity compensation, (OIDA), a non-GAAP measure. In order to reconcile OIDA to operating income, depreciation and amortization and non-cash equity compensation are added back to operating income.
2005 2004 % change ---- ---- -------- OPERATING INCOME (LOSS) Publishing $(14,526) $(13,276) -9.4% Television (25,836) (7,300) -253.9% Merchandising 15,858 16,608 -4.5% Internet/Direct Commerce (3,618) (7,790) 53.6% -------- -------- ------ Operating Loss before Corporate Expenses (28,122) (11,758) -139.2% Corporate Expense (52,724) (38,761) -36.0% -------- -------- ------ TOTAL OPERATING LOSS (80,846) (50,519) -60.0% -------- -------- ------ DEPRECIATION AND AMORTIZATION Publishing 742 269 -175.8% Television 609 173 -252.0% Merchandising 629 570 -10.4% Internet/Direct Commerce 722 740 2.4% Corporate Expense 2,780 3,224 13.8% -------- -------- ------ TOTAL DEPRECIATION AND AMORTIZATION 5,482 4,976 -10.2% -------- -------- ------ NON-CASH EQUITY COMPENSATION Publishing 1,620 127 nm Television 17,355 -- nm Merchandising 232 (72) nm Internet/Direct Commerce 28 -- nm Corporate Expense 18,535 3,414 nm -------- -------- ------ TOTAL NON-CASH EQUITY COMPENSATION 37,770 3,469 nm -------- -------- ------ OPERATING INCOME (LOSS) BEFORE DEPRECIATION AND AMORTIZATION AND NON-CASH EQUITY COMPENSATION Publishing (12,164) (12,880) 5.6% Television (7,872) (7,127) -10.5% Merchandising 16,719 17,106 -2.3% Internet Direct Commerce (2,868) (7,050) 59.3% -------- -------- ------ Operating Loss before Depreciation and Amortization, Non-Cash Equity Compensation, and Corporate Expenses (6,185) (9,951) 37.8% Corporate Expense (31,409) (32,123) 2.2% -------- -------- ------ OPERATING LOSS BEFORE DEPRECIATION AND AMORTIZATION AND NON-CASH EQUITY COMPENSATION $(37,594) $(42,074) 10.6% ======== ======== ======
7 Martha Stewart Living Omnimedia, Inc. Supplemental Disclosures Regarding Non-GAAP Financial Information Fourth Quarter Guidance Reconciliation (in millions) The following table presents consolidated financial information, including a reconciliation of operating income, a GAAP measure, and Operating Income before Depreciation and Amortization, including non-cash equity compensation, (OIDA), a non-GAAP measure. In order to reconcile OIDA to operating income, depreciation and amortization and non-cash equity compensation are added back to operating income. FOURTH QUARTER GUIDANCE RECONCILIATION Operating Income $ 0.0 Depreciation and Amortization 2.0 Non-cash Equity Compensation 9.0 ------- Operating Income Before Depreciation and Amortization and Non-Cash Equity Compensation $ 11.0
8