Dice Holdings, Inc. Reports Third Quarter 2014 Results
• | Revenues increased 29% year-over-year to $67.6 million in the third quarter |
• | Net income totaled $9.5 million, resulting in earnings per diluted share of $0.18, reflecting the impact of recognition of tax loss carryforwards of $1.7 million or $0.03 per diluted share |
• | Cash flows from operations totaled $14.3 million during the third quarter, up $8.2 million or 135% from the prior year quarter |
• | Adjusted EBITDA grew 23% year-over-year to $22.4 million (see “Notes Regarding the Use of Non-GAAP Financial Measures” and “Supplemental Information and Non-GAAP Reconciliations”) |
New York, New York, October 30, 2014 - Dice Holdings, Inc. (NYSE: DHX), a leading provider of specialized websites for professional communities, today reported financial results for the quarter ended September 30, 2014.
Revenues for the quarter ended September 30, 2014 totaled $67.6 million, an increase of 29% from $52.6 million in the comparable quarter of 2013 due primarily to revenues from businesses acquired over the past year, which contributed $13.2 million of growth in the quarter. The increase in quarterly revenues also reflects year-over-year growth at Slashdot Media and eFinancialCareers.
The number of hiring managers and recruiters in the U.S. and Europe utilizing Dice’s Open Web continued to grow during the third quarter. Open Web combines publicly available information from 130 social and professional networks to create an all-in-one candidate profile and a more efficient way to source and connect with candidates.
Operating expenses for the third quarter totaled $54.2 million, an increase of $13.1 million from the comparable quarter of 2013 due to expenses from businesses acquired over the past year.
The Company’s net income for the quarter ended September 30, 2014 totaled $9.5 million, resulting in diluted earnings per share of $0.18. Income tax expense for the quarter was $3.0 million, resulting in an effective tax rate of 24%. This included a benefit of $1.7 million from tax loss carryforwards obtained in the onTargetjobs acquisition which were recognized in the current quarter.
Net cash provided by operating activities totaled $14.3 million for the quarter ended September 30, 2014, an increase of 135% from the $6.1 million for the quarter ended September 30, 2013.
Adjusted EBITDA for the quarter ended September 30, 2014 increased 23% year-over-year to $22.4 million or 33% of Adjusted Revenues. See “Notes Regarding the Use of Non-GAAP Financial Measures” and “Supplemental Information and Non-GAAP Reconciliations.”
Operating Segment Results
For the quarter ended September 30, 2014, Tech & Clearance segment revenues increased 3% year-over-year to $34.8 million, or 51% of consolidated revenues, with the growth attributable to the July 2013 acquisition of The IT Job Board.
Finance segment revenues for the third quarter of 2014 increased 10% year-over-year to $9.4 million, with currency translation positively impacting revenues by $0.6 million year-over-year in the third quarter.
The Energy segment revenues grew 31% year-over-year to $8.0 million in the quarter ended September 30, 2014, accounting for 12% of consolidated revenues. OilCareers, acquired in March 2014, contributed $2.0 million in revenues in the third quarter.
For the quarter ended September 30, 2014, the Healthcare segment contributed $6.9 million in revenues. Revenues from the November 2013 acquisition of HEALTHeCAREERSTM and BioSpace® were $6.6 million.
Hospitality segment revenues for the third quarter of 2014 were $3.7 million, reflecting the acquisition of Hcareers® in November 2013.
Corporate & Other segment revenues grew 30% to $4.8 million for the quarter ended September 30, 2014 due to improvement at Slashdot Media.
Nine Month Operating Results
Revenues for the nine months ended September 30, 2014 totaled $194.8 million, an increase of 26% from $155.1 million in the comparable period of 2013.
By segment, Tech & Clearance revenues increased 3% to $101.3 million for the nine months ended September 30, 2014, including The IT Job Board acquisition which contributed revenues of $7.0 million in the nine months ended September 30, 2014. In the same period, Finance segment revenues grew 6% to $27.5 million from the nine months ended September 30, 2013, including a currency translation benefit of $1.8 million from the comparable 2013 period. Energy segment revenues increased 28% to $22.5 million, including the contribution from OilCareers of $4.2 million. Healthcare and Hospitality contributed revenues of $20.0 million and $10.1 million, respectively, for the first nine months of 2014. Corporate & Other revenues increased 15% to $13.6 million.
Net income for the nine months ended September 30, 2014 totaled $21.1 million, resulting in diluted earnings per share of $0.39 for the nine months ended September 30, 2014.
Net cash provided by operating activities totaled $47.6 million for the nine months ended September 30, 2014. Adjusted EBITDA for the nine months ended September 30, 2014 increased 20% to $64.3 million from $53.4 million for the same period in 2013. See “Notes Regarding the Use of Non-GAAP Financial Measures” and “Supplemental Information and Non-GAAP Reconciliations.”
Balance Sheet
Deferred revenue at September 30, 2014 grew 6% to $81.9 million from $77.4 million at December 31, 2013. The increase was primarily driven by our Finance and Tech & Clearance segments, as well as by the acquisition of OilCareers in March 2014.
Net Debt, defined as total debt less cash and cash equivalents and investments, was $86.1 million at September 30, 2014, consisting of total debt of $113.1 million minus cash and cash equivalents of $27.0 million. This compares to Net Debt of $96.7 million at June 30, 2014, consisting of total debt of $116.8 million minus cash and cash equivalents and investments of $20.1 million.
The Company purchased 1,056,207 shares of its common stock during the third quarter of 2014 pursuant to its stock repurchase plan at an average cost of $8.22 per share, for a total cost of approximately $8.7 million.
Management Comments
“Our results continue to improve, reflecting our ability to leverage our specialty focus, to build best-in-class solutions and to reposition ourselves for stronger growth,” said Michael Durney, President and CEO, Dice Holdings, Inc. “We are continuing to make strides in product development - which has been a key area of focus and investment. During the quarter, we took home two key product awards. Our Dice.com team won a 2014 “Awesome New Technologies for HR” for the #Dice141 job card, and our WorkDigital team won the Top Innovator in Social Data award at DataWeek 2014 for EventGraph, a social media listening product. We are making solid progress towards our goal to expand our relevance to professionals throughout their careers, and to deliver talent efficiently to hiring managers and recruiters.”
“Evidence of continuing progress in our operations is mounting, as we capitalized on a healthy environment to deliver a good quarter. In our Tech & Clearance segment, the Dice recruitment package customer count was stable for a second straight quarter, while Finance’s organic growth rate continues to improve,” said John Roberts, CFO. “Strong profitability and cash flow are distinctive attributes of our business model. This consistency allows us to invest for growth and return cash to shareholders, while considering acquisitions.”
Business Outlook
The Company is providing a current, point-in-time view of estimated financial performance based on its assessment as of October 30, 2014 for the quarter ending December 31, 2014 and the year ending December 31, 2014. The Company’s actual performance will vary based on a number of factors including those that are outlined in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013 in the sections entitled “Risk Factors,” “Forward-Looking Statements” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” In addition, for a description of Adjusted EBITDA as used below, see “Notes Regarding the Use of Non-GAAP Financial Measures” and for required reconciliations to the most comparable GAAP measures, see “Supplemental Information and Non-GAAP Reconciliations.”
Quarter ending December 31, 2014 | Year ending December 31, 2014 | |
Revenues | $67.7 - $68.2 mm | $262.5 - $263 mm |
Estimated Contribution by Segment | ||
Tech & Clearance | 52% | 52% |
Finance | 14% | 14% |
Energy | 12% | 12% |
Healthcare | 10% | 10% |
Hospitality | 5% | 5% |
Corporate & Other | 7% | 7% |
Adjusted EBITDA* | $20.3 - $20.8 mm | $84.5 - $85 mm |
Adjusted EBITDA Margin* | 30% | 32% |
Depreciation and Amortization | $7 mm | $ 28 mm |
Non-cash stock compensation expense | $2 mm | $ 8 mm |
Interest expense, net | $1 mm | $ 4 mm |
Income taxes | $4.1 - $4.3 mm | $14.3 - $14.5 mm |
Net income | $6.5 - $6.8mm | $27.5 - $27.8 mm |
Diluted Earnings per share | $0.12 | $0.50 - $0.51 |
Fully diluted share count | 54.1 mm | 54.5 mm |
*Estimated Adjusted EBITDA includes an estimated fair value adjustment to deferred revenue of $140,000 and $2.9 million, respectively, for the quarter and year ending December 31, 2014. Adjusted EBITDA margin is computed as Adjusted EBITDA divided by Adjusted Revenues (see “Notes Regarding the Use of Non-GAAP Financial Measures” and “Supplemental Information and Non-GAAP Reconciliations.”)
Conference Call Information
The Company will host a conference call to discuss third quarter results today at 8:30 a.m. Eastern Time. Hosting the call will be Michael P. Durney, President and Chief Executive Officer and John J. Roberts, Chief Financial Officer.
The conference call can be accessed live over the phone by dialing 1-877-270-2148 or for international callers by dialing 1-412-902-6510. Please ask to be joined to the Dice Holdings, Inc. call. A replay will be available one hour after the call and can be accessed by dialing 1-877-344-7529 or 1-412-317-0088 for international callers; the replay passcode is 10054010. The replay will be available until November 7, 2014.
The call will also be webcast live from the Company’s website at www.diceholdingsinc.com under the Investor Relations section.
Investor Contact
Constance Melrose
Vice President, Corporate Development
Dice Holdings, Inc.
212-448-4181
IR@dice.com
Media Contact
Rachel Ceccarelli
Manager, Public Relations & Corporate Communications
Dice Holdings, Inc.
212-448-8288
dicemedia@dice.com
About Dice Holdings, Inc.
Dice Holdings, Inc. (NYSE: DHX) is a leading provider of specialized websites for professional communities, including technology and engineering, financial services, energy, healthcare, hospitality and security clearance. Our mission is to help our customers source and hire the most qualified professionals in select and highly skilled occupations, and to help those professionals find the best job opportunities in their respective fields and further their careers. For more than 20 years, we have built our company by providing our customers with quick and easy access to high-quality, unique professional communities and offering those communities access to highly relevant career opportunities and information. Today, we serve multiple markets primarily in North America, Europe, Asia and Australia.
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 in the United States (“GAAP”) and may be different from similarly titled non-GAAP measures reported by other companies. The Company believes that its presentation of non-GAAP measures, such as adjusted earnings before interest, taxes, depreciation, amortization, non-cash stock based compensation expense, and other non-recurring income or expense (“Adjusted EBITDA”), free cash flow, Adjusted Revenues, net cash and net debt, provides useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations. In addition, the Company’s management uses these measures for reviewing the financial results of the Company and for budgeting and planning purposes. The Company has provided required reconciliations to the most comparable GAAP measures in the section entitled “Supplemental Information and Non-GAAP Reconciliations.”
Adjusted EBITDA
Adjusted EBITDA is a non-GAAP metric used by management to measure operating performance. Management uses Adjusted EBITDA as a performance measure for internal monitoring and planning, including preparation of annual budgets, analyzing investment decisions and evaluating profitability and performance comparisons between us and our competitors. The Company also uses this measure to calculate amounts of performance based compensation under the senior management incentive bonus program. Adjusted EBITDA, as defined in our Credit Agreement, represents net income plus (to the extent deducted in calculating such net income) interest expense, income tax expense, depreciation and amortization, non-cash stock option expenses, losses resulting from certain dispositions outside the ordinary course of business, certain writeoffs in connection with indebtedness, impairment charges with respect to long-lived assets, expenses incurred in connection with an equity offering, extraordinary or non-recurring non-cash expenses or losses, transaction costs in connection with the Credit Agreement up to $250,000, deferred revenues written off in connection with acquisition purchase accounting adjustments, writeoff of non-cash stock compensation expense, and business interruption insurance proceeds, minus (to the extent included in calculating such net income) non-cash income or gains, interest income, and any income or gain resulting from certain dispositions outside the ordinary course of business.
We consider Adjusted EBITDA, as defined above, to be an important indicator to investors because it provides information related to our ability to provide cash flows to meet future debt service, capital expenditures and working capital requirements and to fund future growth as well as to monitor compliance with financial covenants. We present Adjusted EBITDA as a supplemental performance measure because we believe that this measure provides our board of directors, management and investors with additional information to measure our performance, provide comparisons from period to period and company to company by excluding potential differences caused by variations in capital structures (affecting interest expense) and tax positions (such as the impact on periods or companies of changes in effective tax rates or net operating losses), and to estimate our value.
We present Adjusted EBITDA because covenants in our Credit Agreement contain ratios based on this measure. Our Credit Agreement is material to us because it is one of our primary sources of liquidity. If our Adjusted EBITDA were to decline below certain levels, covenants in our Credit Agreement that are based on Adjusted EBITDA may be violated and could cause a default and acceleration of payment obligations under our Credit Agreement.
Adjusted EBITDA is not a measurement of our financial performance under GAAP and should not be considered as an alternative to net income, operating income or any other performance measures derived in accordance with GAAP or as an alternative to cash flow from operating activities as a measure of our profitability or liquidity.
Adjusted Revenues
Adjusted Revenues is a non-GAAP metric used by management to measure operating performance. Adjusted Revenues, represents Revenues plus the add back of the fair value adjustment to deferred revenue related to purchase accounting of acquisitions. We consider Adjusted Revenues to be an important measure to evaluate the performance of our acquisitions.
Free Cash Flow
We define free cash flow as net cash provided by operating activities minus capital expenditures. We believe free cash flow is an important non-GAAP measure as it provides useful cash flow information regarding our ability to service, incur or pay down indebtedness or repurchase our common stock. We use free cash flow as a measure to reflect cash available to service our debt as well as to fund our expenditures. A limitation of using free cash flow versus the GAAP measure of net cash provided by operating activities is that free cash flow does not represent the total increase or decrease in the cash balance from operations for the period since it includes cash used for capital expenditures during the period and is adjusted for acquisition related payments within operating cash flows.
Net Cash/Net Debt
Net Cash is defined as cash and cash equivalents and investments less total debt. Net Debt is defined as total debt less cash and cash equivalents and investments. We consider Net Cash and Net Debt to be important measures of liquidity and indicators of our ability to meet ongoing obligations. We also use Net Cash and Net Debt, among other measures, in evaluating our choices for capital deployment. Net Cash and Net Debt presented herein are non-GAAP measures and may not be comparable to similarly titled measures used by other companies.
Forward-Looking Statements
This press release and oral statements made from time to time by our representatives contains forward-looking statements. You should not place undue reliance on those statements because they are subject to numerous uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Forward-looking statements include information without limitation concerning our possible or assumed future results of operations, including descriptions of our business strategy. These statements often include words such as “may,” “will,” “should,” “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate” or similar expressions. These statements are based on assumptions that we have made in light of our experience in the industry as well as our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. Although we believe that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to, competition from existing and future competitors in the highly competitive market in which we operate, failure to adapt our business model to keep pace with rapid changes in the recruiting and career services business, failure to maintain and develop our reputation and brand recognition, failure to increase or maintain the number of customers who purchase recruitment packages, cyclicality or downturns in the economy or industries we serve, failure to attract qualified professionals to our websites or grow the number of qualified professionals who use our websites, failure to successfully identify or integrate acquisitions, U.S. and foreign government regulation of the Internet and taxation, our ability to borrow funds under our revolving credit facility or refinance our indebtedness and restrictions on our current and future operations under such indebtedness. These factors and others are discussed in more detail in the Company’s filings with the Securities and Exchange Commission, all of which are available on the Investor Relations page of our website at www.diceholdingsinc.com, including the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013, under the headings “Risk Factors,” “Forward-Looking Statements” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
You should keep in mind that any forward-looking statement made by the Company or its representatives herein, or elsewhere, speaks only as of the date on which it is made. New risks and uncertainties come up from time to time, and it is impossible to predict these events or how they may affect us. We have no obligation to update any forward-looking statements after the date hereof, except as required by federal securities laws.
DICE HOLDINGS, INC. | ||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||
(in thousands except per share amounts) | ||||||||||||||||||||
For the three months ended September 30, | For the nine months ended September 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
Revenues | $ | 67,615 | $ | 52,616 | $ | 194,849 | $ | 155,064 | ||||||||||||
Operating expenses: | ||||||||||||||||||||
Cost of revenues | 9,418 | 6,099 | 27,803 | 16,853 | ||||||||||||||||
Product development | 6,487 | 5,597 | 19,254 | 16,253 | ||||||||||||||||
Sales and marketing | 20,746 | 16,601 | 60,032 | 50,106 | ||||||||||||||||
General and administrative | 10,760 | 8,534 | 32,131 | 25,040 | ||||||||||||||||
Depreciation | 2,930 | 2,011 | 8,647 | 5,377 | ||||||||||||||||
Amortization of intangible assets | 3,798 | 2,208 | 12,552 | 5,617 | ||||||||||||||||
Change in acquisition related contingencies | 44 | 50 | 134 | 146 | ||||||||||||||||
Total operating expenses | 54,183 | 41,100 | 160,553 | 119,392 | ||||||||||||||||
Operating income | 13,432 | 11,516 | 34,296 | 35,672 | ||||||||||||||||
Interest expense | (927 | ) | (378 | ) | (2,875 | ) | (1,097 | ) | ||||||||||||
Other income (expense) | 8 | 5 | (129 | ) | 261 | |||||||||||||||
Income before income taxes | 12,513 | 11,143 | 31,292 | 34,836 | ||||||||||||||||
Income tax expense | 3,020 | 4,085 | 10,196 | 12,730 | ||||||||||||||||
Net income | $ | 9,493 | $ | 7,058 | $ | 21,096 | $ | 22,106 | ||||||||||||
Basic earnings per share | $ | 0.18 | $ | 0.12 | $ | 0.40 | $ | 0.39 | ||||||||||||
Diluted earnings per share | $ | 0.18 | $ | 0.12 | $ | 0.39 | $ | 0.37 | ||||||||||||
Weighted average basic shares outstanding | 52,089 | 56,606 | 52,486 | 57,324 | ||||||||||||||||
Weighted average diluted shares outstanding | 54,106 | 59,505 | 54,545 | 60,497 | ||||||||||||||||
DICE HOLDINGS, INC. | |||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||
(in thousands) | |||||||||||||||||||||
For the three months ended September 30, | For the nine months ended September 30, | For the year ended December 31, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2013 | |||||||||||||||||
Cash flows from operating activities: | |||||||||||||||||||||
Net income | $ | 9,493 | $ | 7,058 | $ | 21,096 | $ | 22,106 | $ | 38,087 | |||||||||||
Adjustments to reconcile net income to net cash flows from operating activities: | |||||||||||||||||||||
Depreciation | 2,930 | 2,011 | 8,647 | 5,377 | 5,657 | ||||||||||||||||
Amortization of intangible assets | 3,798 | 2,208 | 12,552 | 5,617 | 6,654 | ||||||||||||||||
Deferred income taxes | (1,632 | ) | (955 | ) | (4,317 | ) | (1,841 | ) | (4,406 | ) | |||||||||||
Amortization of deferred financing costs | 93 | 60 | 278 | 181 | 315 | ||||||||||||||||
Stock based compensation | 1,739 | 2,051 | 5,886 | 6,263 | 6,130 | ||||||||||||||||
Change in acquisition related contingencies | 44 | 50 | 134 | 146 | 48 | ||||||||||||||||
Change in accrual for unrecognized tax benefits | 613 | (61 | ) | 893 | (126 | ) | (1,367 | ) | |||||||||||||
Changes in operating assets and liabilities: | |||||||||||||||||||||
Accounts receivable | (1,427 | ) | (1,500 | ) | (232 | ) | 5,263 | (3,253 | ) | ||||||||||||
Prepaid expenses and other assets | 1,726 | 728 | (446 | ) | 321 | (835 | ) | ||||||||||||||
Accounts payable and accrued expenses | 4,600 | 1,152 | (16 | ) | 2,681 | 544 | |||||||||||||||
Income taxes receivable/payable | (4,879 | ) | (1,676 | ) | (956 | ) | (4,292 | ) | 776 | ||||||||||||
Deferred revenue | (3,347 | ) | (5,035 | ) | 3,581 | (916 | ) | 5,581 | |||||||||||||
Other, net | 528 | (2 | ) | 544 | 4 | (35 | ) | ||||||||||||||
Net cash flows from operating activities | 14,279 | 6,089 | 47,644 | 40,784 | 54,661 | ||||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||
Payments for acquisitions, net of cash acquired | — | (12,259 | ) | (27,001 | ) | (12,259 | ) | (30,800 | ) | ||||||||||||
Purchases of fixed assets | (1,838 | ) | (2,412 | ) | (6,784 | ) | (8,160 | ) | (5,902 | ) | |||||||||||
Purchases of investments | — | — | — | (3 | ) | (1,744 | ) | ||||||||||||||
Maturities and sales of investments | — | — | — | 2,194 | 4,507 | ||||||||||||||||
Net cash flows from investing activities | (1,838 | ) | (14,671 | ) | (33,785 | ) | (18,228 | ) | (33,939 | ) | |||||||||||
Cash flows from financing activities: | |||||||||||||||||||||
Payments on long-term debt | (9,625 | ) | — | (23,875 | ) | (20,000 | ) | (23,500 | ) | ||||||||||||
Proceeds from long-term debt | 6,000 | 34,000 | 18,000 | 34,000 | 54,500 | ||||||||||||||||
Payments under stock repurchase plan | (8,362 | ) | (22,690 | ) | (26,909 | ) | (35,046 | ) | (68,220 | ) | |||||||||||
Payment of acquisition related contingencies | — | — | (824 | ) | — | (1,557 | ) | ||||||||||||||
Proceeds from stock option exercises | 4,654 | 552 | 7,974 | 3,149 | 2,474 | ||||||||||||||||
Purchase of treasury stock related to vested restricted stock | (112 | ) | (12 | ) | (1,223 | ) | (995 | ) | (423 | ) | |||||||||||
Excess tax benefit over book expense from stock based compensation | 869 | 1,101 | 1,504 | 2,346 | 998 | ||||||||||||||||
Net cash flows from financing activities | (6,576 | ) | 12,951 | (25,353 | ) | (16,546 | ) | (36,829 | ) | ||||||||||||
Effect of exchange rate changes | 1,103 | (271 | ) | (839 | ) | (1,326 | ) | 883 | |||||||||||||
Net change in cash and cash equivalents for the period | 6,968 | 4,098 | (12,333 | ) | 4,684 | (15,224 | ) | ||||||||||||||
Cash and cash equivalents, beginning of period | 20,050 | 40,599 | 39,351 | 40,013 | 55,237 | ||||||||||||||||
Cash and cash equivalents, end of period | $ | 27,018 | $ | 44,697 | $ | 27,018 | $ | 44,697 | $ | 40,013 | |||||||||||
DICE HOLDINGS, INC. | |||||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||||||||
(Unaudited) | |||||||||||||
(in thousands) | |||||||||||||
ASSETS | September 30, 2014 | December 31, 2013 | |||||||||||
Current assets | |||||||||||||
Cash and cash equivalents | $ | 27,018 | $ | 39,351 | |||||||||
Accounts receivable, net | 40,022 | 37,760 | |||||||||||
Deferred income taxes—current | 2,811 | 1,399 | |||||||||||
Income taxes receivable | 3,310 | 2,399 | |||||||||||
Prepaid and other current assets | 4,159 | 3,739 | |||||||||||
Total current assets | 77,320 | 84,648 | |||||||||||
Fixed assets, net | 16,290 | 18,612 | |||||||||||
Acquired intangible assets, net | 85,936 | 84,905 | |||||||||||
Goodwill | 243,198 | 230,190 | |||||||||||
Deferred financing costs, net | 1,407 | 1,685 | |||||||||||
Deferred income taxes—non-current | 1,235 | — | |||||||||||
Other assets | 874 | 601 | |||||||||||
Total assets | $ | 426,260 | $ | 420,641 | |||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||
Current liabilities | |||||||||||||
Accounts payable and accrued expenses | $ | 27,300 | $ | 27,468 | |||||||||
Deferred revenue | 81,906 | 77,394 | |||||||||||
Current portion of acquisition related contingencies | 9,040 | 5,751 | |||||||||||
Current portion of long-term debt | 2,500 | 2,500 | |||||||||||
Deferred income taxes—current | 110 | 123 | |||||||||||
Income taxes payable | 1,186 | 400 | |||||||||||
Total current liabilities | 122,042 | 113,636 | |||||||||||
Long-term debt | 110,625 | 116,500 | |||||||||||
Deferred income taxes—non-current | 14,901 | 13,641 | |||||||||||
Accrual for unrecognized tax benefits | 3,511 | 2,618 | |||||||||||
Acquisition related contingencies | — | 4,042 | |||||||||||
Other long-term liabilities | 3,013 | 2,392 | |||||||||||
Total liabilities | 254,092 | 252,829 | |||||||||||
Total stockholders’ equity | 172,168 | 167,812 | |||||||||||
Total liabilities and stockholders’ equity | $ | 426,260 | $ | 420,641 | |||||||||
Supplemental Information and Non-GAAP Reconciliations
On the pages that follow, the Company has provided certain supplemental information that we believe will assist the reader in assessing our business operations and performance, including certain non-GAAP financial information and required reconciliations to the most comparable GAAP measure. A statement of operations and statement of cash flows for the three and nine month periods ended September 30, 2014 and 2013 and a balance sheet as of September 30, 2014 and December 31, 2013 are provided elsewhere in this press release.
DICE HOLDINGS, INC. | |||||||||||||||||||
NON-GAAP AND QUARTERLY SUPPLEMENTAL DATA | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
(dollars in thousands except per customer data) | |||||||||||||||||||
For the three months ended September 30, | For the nine months ended September 30, | For the year ended December 31, | |||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | |||||||||||||||
Revenues by Segment (GAAP Revenue) | |||||||||||||||||||
Tech & Clearance (1) | $ | 34,783 | $ | 33,610 | $ | 101,268 | $ | 97,988 | $ | 34,783 | |||||||||
Finance | 9,449 | 8,556 | 27,493 | 25,891 | 9,449 | ||||||||||||||
Energy (2) | 8,043 | 6,157 | 22,465 | 17,529 | 8,043 | ||||||||||||||
Healthcare (3) | 6,921 | 634 | 19,995 | 1,831 | 6,921 | ||||||||||||||
Hospitality | 3,668 | — | 10,050 | — | 3,668 | ||||||||||||||
Corporate & Other | 4,751 | 3,659 | 13,578 | 11,825 | 4,751 | ||||||||||||||
$ | 67,615 | $ | 52,616 | $ | 194,849 | $ | 155,064 | $ | 67,615 | ||||||||||
Add back fair value adjustment to deferred revenue | |||||||||||||||||||
Tech & Clearance | $ | — | $ | 359 | $ | 262 | $ | 359 | $ | 262 | |||||||||
Energy | 160 | — | 617 | — | |||||||||||||||
Healthcare | 153 | — | 839 | — | 839 | ||||||||||||||
Hospitality | 164 | — | 1,027 | — | 1,027 | ||||||||||||||
$ | 477 | $ | 359 | $ | 2,745 | $ | 359 | $ | 2,128 | ||||||||||
Adjusted Revenues by Segment | |||||||||||||||||||
Tech & Clearance | $ | 34,783 | $ | 33,969 | $ | 101,530 | $ | 98,347 | $ | 101,530 | |||||||||
Finance | 9,449 | 8,556 | 27,493 | 25,891 | 27,493 | ||||||||||||||
Energy | 8,203 | 6,157 | 23,082 | 17,529 | 23,082 | ||||||||||||||
Healthcare | 7,074 | 634 | 20,834 | 1,831 | 20,834 | ||||||||||||||
Hospitality | 3,832 | — | 11,077 | — | 11,077 | ||||||||||||||
Corporate & Other | 4,751 | 3,659 | 13,578 | 11,825 | 13,578 | ||||||||||||||
$ | 68,092 | $ | 52,975 | $ | 197,594 | $ | 155,423 | $ | 197,594 | ||||||||||
Reconciliation of Net Income to Adjusted EBITDA: | |||||||||||||||||||
Net income | $ | 9,493 | $ | 7,058 | $ | 21,096 | $ | 22,106 | |||||||||||
Interest expense | 927 | 378 | 2,875 | 1,097 | |||||||||||||||
Income tax expense | 3,020 | 4,085 | 10,196 | 12,730 | |||||||||||||||
Depreciation | 2,930 | 2,011 | 8,647 | 5,377 | |||||||||||||||
Amortization of intangible assets | 3,798 | 2,208 | 12,552 | 5,617 | |||||||||||||||
Change in acquisition related contingencies | 44 | 50 | 134 | 146 | |||||||||||||||
Non-cash stock compensation expense | 1,739 | 2,051 | 5,886 | 6,263 | |||||||||||||||
Deferred revenue adjustment | 477 | 359 | 2,745 | 359 | |||||||||||||||
Other | (8 | ) | (5 | ) | 129 | (261 | ) | ||||||||||||
Adjusted EBITDA | $ | 22,420 | $ | 18,195 | $ | 64,260 | $ | 53,434 | |||||||||||
Reconciliation of Operating Cash Flows to Adjusted EBITDA: | |||||||||||||||||||
Net cash provided by operating activities | $ | 14,279 | $ | 6,089 | $ | 47,644 | $ | 40,784 | |||||||||||
Interest expense | 927 | 378 | 2,875 | 1,097 | |||||||||||||||
Amortization of deferred financing costs | (93 | ) | (60 | ) | (278 | ) | (181 | ) | |||||||||||
Income tax expense | 3,020 | 4,085 | 10,196 | 12,730 | |||||||||||||||
Deferred income taxes | 1,632 | 955 | 4,317 | 1,841 | |||||||||||||||
Change in accrual for unrecognized tax benefits | (613 | ) | 61 | (893 | ) | 126 | |||||||||||||
Change in accounts receivable | 1,427 | 1,500 | 232 | (5,263 | ) | ||||||||||||||
Change in deferred revenue | 3,347 | 5,035 | (3,581 | ) | 916 | ||||||||||||||
Deferred revenue adjustment | 477 | 359 | 2,745 | 359 | |||||||||||||||
Changes in working capital and other | (1,983 | ) | (207 | ) | 1,003 | 1,025 | |||||||||||||
Adjusted EBITDA | $ | 22,420 | $ | 18,195 | $ | 64,260 | $ | 53,434 | |||||||||||
DICE HOLDINGS, INC. | |||||||||||||||||||
NON-GAAP AND QUARTERLY SUPPLEMENTAL DATA (CONTINUED) | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
For the three months ended September 30, | For the nine months ended September 30, | ||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||
Adjusted EBITDA | $ | 22,420 | $ | 18,195 | $ | 64,260 | $ | 53,434 | |||||||||||
Adjusted EBITDA Margin (4) | 32.9 | % | 34.3 | % | 32.5 | % | 34.4 | % | |||||||||||
Calculation of Free Cash Flow | |||||||||||||||||||
Net cash provided by operating activities | $ | 14,279 | $ | 6,089 | $ | 47,644 | $ | 40,784 | |||||||||||
Purchases of fixed assets | (1,838 | ) | (2,412 | ) | (6,784 | ) | (8,160 | ) | |||||||||||
Free Cash Flow | $ | 12,441 | $ | 3,677 | $ | 40,860 | $ | 32,624 | |||||||||||
Dice.com Recruitment Package Customers | |||||||||||||||||||
Beginning of period | 8,000 | 8,650 | 8,100 | 8,400 | |||||||||||||||
End of period | 8,000 | 8,450 | 8,000 | 8,450 | |||||||||||||||
Average for the period (5) | 8,000 | 8,550 | 8,000 | 8,600 | |||||||||||||||
Dice.com Average Monthly Revenue per Recruitment Package Customer (6) | $ | 1,047 | $ | 998 | $ | 1,035 | $ | 996 | |||||||||||
Segment Definitions: | |||||||||||||||||||
Tech & Clearance: Dice.com, ClearanceJobs, The IT Job Board (from acquisition, July 2013) and related career fairs | |||||||||||||||||||
Finance: eFinancialCareers | |||||||||||||||||||
Energy: Rigzone, OilCareers (from acquisition, March 2014) and related career fairs | |||||||||||||||||||
Healthcare: Health Callings; HEALTHeCAREERS and BioSpace (both from acquisition, November 2013) | |||||||||||||||||||
Hospitality: Hcareers (from acquisition, November 2013) | |||||||||||||||||||
Corporate & Other: Corporate related costs, Slashdot Media and WorkDigital | |||||||||||||||||||
(1) Includes $2.5 million and $7.0 million of The IT Job Board revenue for the third quarter and nine months ended September 30, 2014, respectively, and $1.1 million for the third quarter and nine months ended September 30, 2013. | |||||||||||||||||||
(2) Includes $2.0 million and $4.2 million of OilCareers revenue for the third quarter and nine months ended September 30, 2014, respectively. | |||||||||||||||||||
(3) Includes $6.6 million and $18.5 million of HEALTHeCAREERS and BioSpace revenue for the third quarter and nine months ended September 30, 2014, respectively. | |||||||||||||||||||
(4) Adjusted EBITDA margin is computed as Adjusted EBITDA divided by Adjusted Revenues. | |||||||||||||||||||
(5) Reflects the daily average of recruitment package customers during the period. | |||||||||||||||||||
(6) Reflects simple average of three months in each period. | |||||||||||||||||||