Exhibit 99.1
PRESS RELEASE FOR IMMEDIATE ISSUE
| FOR: | MDC Partners Inc. | CONTACT: | Matt Chesler, CFA |
| 745 Fifth Avenue, 19th Floor | VP, Investor Relations | ||
| New York, NY 10151 | 646-412-6877 | ||
| mchesler@mdc-partners.com |
MDC
PARTNERS INC. REPORTS RESULTS FOR THE
THREE AND SIX MONTHS ENDED JUNE 30, 2015
SECOND QUARTER HIGHLIGHTS:
| · | Revenue increased to $336.6 million from $299.4 million, an increase of 12.4% |
| · | Net income attributable to MDC Partners of $29.6 million versus $16.5 million in the same period last year |
| · | Organic revenue increased 8.3% |
| · | Adjusted EBITDA of $47.5 million versus $48.9 million in the same period last year (see Schedules 2 and 3) |
| · | Adjusted EBITDA margin of 14.1% versus 16.3% in the same period last year (see Schedules 2 and 3) |
| · | Adjusted EBITDA Available for General Capital Purposes of $27.7 million versus $31.8 million in the same period last year (see Schedule 6) |
| · | Net New Business wins totaled $27.3 million |
| · | Declared cash dividend of $0.21 per share |
YEAR-TO-DATE HIGHLIGHTS:
| · | Revenue increased to $638.8 million from $574.2 million, an increase of 11.3% |
| · | Net loss attributable to MDC Partners of ($2.5) million versus income of $7.6 million in the same period last year |
| · | Organic revenue increased 7.8% |
| · | Adjusted EBITDA of $78.6 million versus $84.7 million in the same period last year (see Schedules 4 and 5) |
| · | Adjusted EBITDA margin of 12.3% versus 14.7% in the same period last year (see Schedules 4 and 5) |
| · | Adjusted EBITDA Available for General Capital Purposes of $38.0 million versus $52.3 million in the same period last year (see Schedule 6) |
| · | Net New Business wins totaled $55.3 million |
New York, NY, August 6, 2015 (NASDAQ: MDCA; TSX: MDZ.A) – MDC Partners Inc. (“MDC Partners” or the “Company”) today announced financial results for the three and six months ended June 30, 2015.
Scott Kauffman, Chairman and Chief Executive Officer of MDC Partners, said, “We delivered strong results in the second quarter with exceptional organic growth of 8%, total revenue growth of 12% and solid cash generation. Adjusted EBITDA, while down modestly year over year due to the timing of revenue recognition associated with certain accounts, is tracking as predicted to our annual growth forecast. Our partner companies continue to consistently deliver best in class results on behalf of their clients, we are winning new business on a larger and increasingly global scale, and importantly, our unique culture is fostering talent and innovation. In the short-term we are on track to achieve our annual financial guidance, and in the long-term, we have never been in a better strategic position to continue posting industry leading operational and financial results. I am very excited about the future of MDC.”
| Page 1 |
Guidance for 2015 is reaffirmed as follows:
| Implied | ||||||
| 2014 | 2015 | Year over Year | ||||
| Actuals | Guidance | Change | ||||
| Revenue | $1.22 billion | $1.300 - $1.330 billion | +6.5% to +8.5% | |||
| Adjusted EBITDA | $179.4 million | $195 - $205 million | +8.7% to +14.3% | |||
| Implied Adjusted EBITDA Margin | 14.7% | 15.0% to 15.4% | +35 to 75 basis points | |||
| Adjusted EBITDA Available for | $98.8 million | $109 - $119 million | +10.3% to +20.4% | |||
| General Capital Purposes |
Consolidated revenue for the second quarter of 2015 was $336.6 million, an increase of 12.4%, compared to $299.4 million in the second quarter of 2014. Adjusted EBITDA for the second quarter of 2015 was $47.5 million compared to $48.9 million in the second quarter of 2014. Net income attributable to MDC Partners in the second quarter was $29.6 million compared to $16.5 million in the second quarter of 2014. Diluted income per share from continuing operations attributable to MDC Partners common shareholders for the second quarter of 2015 was $0.56 compared to $0.35 per share in the second quarter of 2014. Adjusted EBITDA Available for General Capital Purposes was $27.7 million in the second quarter of 2015 compared to $31.8 million in the second quarter of 2014.
For the six month period ended June 30, 2015, consolidated revenue was $638.8 million, an increase of 11.3% compared to $574.2 million in the six months ended June 30, 2014. Adjusted EBITDA for the six months ended June 30, 2015 was $78.6 million compared to $84.7 million in the same period of 2014. Net loss attributable to MDC Partners in the six months ended June 30, 2015 was ($2.5) million compared to income of $7.6 million in the same period of 2014. Diluted income per share from continuing operations attributable to MDC Partners common shareholders for the six months ended June 30, 2015 was $0.05 compared to $0.18 per share in the same period of 2014. Adjusted EBITDA Available for General Capital Purposes was $38.0 million in the six months ended June 30, 2015, compared to $52.3 million in the same period of 2014.
David Doft, CFO of MDC Partners, said, “The fundamental performance of our business this quarter was strong and consistent with our expectations. We remain firmly on track for a successful second half of the year and to achieving our 17-19% mid-term margin outlook. We are particularly pleased with how we performed from a cash standpoint, despite $95.9 million of deferred acquisition consideration and step-up closing payments in the quarter. Our liquidity position is strong and affords us the flexibility to continue to build our business while also de-levering the balance sheet. We are exceptionally encouraged by where we stand heading into the back half of the year.”
MDC Partners Announces $0.21 per Share Quarterly Cash Dividend
MDC Partners today also announced that its Board of Directors has declared a cash dividend of $0.21 per share on all of its outstanding Class A shares and Class B shares. The quarterly dividend will be payable on or about September 1, 2015, to shareholders of record at the close of business on August 18, 2015.
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Conference Call
Management will host a conference call on Thursday, August 6, 2015, at 5:00 p.m. (ET) to discuss results. Access the conference call by dialing 1-412-902-4266 or toll free 1-888-346-6216. An investor presentation has been posted on our website www.mdc-partners.com and may be referred to during the conference call.
A recording of the conference call will be available one hour after the call until 9:00 a.m. (ET), August 14, 2015, by dialing 1-412-317-0088 or toll free 1-877-344-7529 (passcode 10070129), or by visiting our website at www.mdc-partners.com.
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About MDC Partners Inc.
MDC Partners is one of the fastest-growing and most influential marketing and communications networks in the world. Its 50+ advertising, public relations, branding, digital, social and event marketing agencies are responsible for some of the most memorable and engaging campaigns for the world’s most respected brands. By leveraging technology, data analytics, insights, and strategic consulting solutions, MDC Partners drives measurable results and optimizes return on marketing investment for over 1,500 clients worldwide.
As "The Place Where Great Talent Lives," MDC Partners is known for its unique partnership model, empowering the most entrepreneurial and innovative talent to drive competitive advantage and business growth for clients. For more information about MDC Partners and its partner firms, visit www.mdc-partners.com and follow us on Twitter: http://www.twitter.com/mdcpartners
Non-GAAP Financial Measures
In addition to its reported results, MDC Partners has included in this earnings release certain financial results that the Securities and Exchange Commission defines as "non-GAAP financial measures." Management believes that such non-GAAP financial measures, when read in conjunction with the Company's reported results, can provide useful supplemental information for investors analyzing period to period comparisons of the Company's results. These non-GAAP financial measures relate to: (1) presenting Adjusted EBITDA and EBITDA margin (as defined) for the three and six months ended June 30, 2015, and 2014; and (2) presenting Adjusted EBITDA Available for General Capital Purposes for the three and six months ended June 30, 2015, and 2014. Included in this earnings release are tables reconciling MDC Partners’ reported results to arrive at these non-GAAP financial measures.
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This press release contains forward-looking statements. The Company’s representatives may also make forward-looking statements orally from time to time. Statements in this press release that are not historical facts, including statements about the Company’s beliefs and expectations, earnings guidance, recent business and economic trends, potential acquisitions, estimates of amounts for deferred acquisition consideration and “put” option rights, constitute forward-looking statements. These statements are based on current plans, estimates and projections, and are subject to change based on a number of factors, including those outlined in this section. Forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update publicly any of them in light of new information or future events, if any.
Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statements. Such risk factors include, but are not limited to, the following:
| · | risks associated with the Subpoena and ongoing SEC investigation and related securities litigation claims; |
| · | risks associated with severe effects of international, national and regional economic downturn; |
| · | the Company’s ability to attract new clients and retain existing clients; |
| · | the spending patterns and financial success of the Company’s clients; |
| · | the Company’s ability to retain and attract key employees; |
| · | the Company’s ability to remain in compliance with its debt agreements and the Company’s ability to finance its contingent payment obligations when due and payable, including but not limited to those relating to “put” option right and deferred acquisition consideration; |
| · | the successful completion and integration of acquisitions which complement and expand the Company’s business capabilities; and |
| · | foreign currency fluctuations. |
The Company’s business strategy includes ongoing efforts to engage in acquisitions of ownership interests in entities in the marketing communications services industry. The Company intends to finance these acquisitions by using available cash from operations, from borrowings under its credit facility and through incurrence of bridge or other debt financing, any of which may increase the Company’s leverage ratios, or by issuing equity, which may have a dilutive impact on existing shareholders proportionate ownership. At any given time the Company may be engaged in a number of discussions that may result in one or more acquisitions. These opportunities require confidentiality and may involve negotiations that require quick responses by the Company. Although there is uncertainty that any of these discussions will result in definitive agreements or the completion of any transactions, the announcement of any such transaction may lead to increased volatility in the trading price of the Company’s securities.
Investors should carefully consider these risk factors and the additional risk factors outlined in more detail in the Annual Report on Form 10-K under the caption “Risk Factors” and in the Company’s other SEC filings.
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| SCHEDULE 1 |
| MDC PARTNERS INC. |
| UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS |
| (US$ in 000s, except share and per share amounts) |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2015 | 2014 | 2015 | 2014 | |||||||||||||
| Revenue | $ | 336,606 | $ | 299,356 | $ | 638,828 | $ | 574,210 | ||||||||
| Operating Expenses: | ||||||||||||||||
| Cost of services sold | 225,042 | 188,875 | 435,461 | 370,343 | ||||||||||||
| Office and general expenses | 53,075 | 71,436 | 127,383 | 142,772 | ||||||||||||
| Depreciation and amortization | 14,007 | 9,917 | 26,307 | 20,399 | ||||||||||||
| 292,124 | 270,228 | 589,151 | 533,514 | |||||||||||||
| Operating profit | $ | 44,482 | 29,128 | 49,677 | 40,696 | |||||||||||
| Other Income (Expenses): | ||||||||||||||||
| Other, net | 4,348 | 7,564 | (13,692 | ) | 993 | |||||||||||
| Interest expense and finance charges | (13,288 | ) | (13,882 | ) | (28,384 | ) | (26,641 | ) | ||||||||
| Interest income | 105 | 42 | 224 | 182 | ||||||||||||
| Income from continuing operations before income taxes | ||||||||||||||||
| and equity in non-consolidated affiliates | 35,647 | 22,852 | 7,825 | 15,230 | ||||||||||||
| Income tax expense | 4,679 | 3,376 | 625 | 3,030 | ||||||||||||
| Income from continuing operations before equity in non-consolidated affiliates | 30,968 | 19,476 | 7,200 | 12,200 | ||||||||||||
| Equity in earnings of non-consolidated affiliates | 104 | 79 | 455 | 142 | ||||||||||||
| Income from continuing operations | 31,072 | 19,555 | 7,655 | 12,342 | ||||||||||||
| Income (loss) from discontinued operations attributable to MDC Partners Inc., net of taxes | 1,329 | (1,336 | ) | (4,965 | ) | (1,607 | ) | |||||||||
| Net income | 32,401 | 18,219 | 2,690 | 10,735 | ||||||||||||
| Net income attributable to the noncontrolling interests | (2,841 | ) | (1,749 | ) | (5,221 | ) | (3,111 | ) | ||||||||
| Net income (loss) attributable to MDC Partners Inc. | $ | 29,560 | $ | 16,470 | $ | (2,531 | ) | $ | 7,624 | |||||||
| Income (loss) Per Common Share: | ||||||||||||||||
| Basic: | ||||||||||||||||
| Income from continuing operations attributable to MDC | ||||||||||||||||
| Partners Inc. common shareholders | $ | 0.57 | $ | 0.36 | $ | 0.05 | $ | 0.19 | ||||||||
| Discontinued operations attributable to MDC | ||||||||||||||||
| Partners Inc. common shareholders | $ | 0.03 | $ | (0.03 | ) | $ | (0.10 | ) | $ | (0.03 | ) | |||||
| Net income (loss) attributable to MDC Partners Inc. | ||||||||||||||||
| common shareholders | $ | 0.60 | $ | 0.33 | $ | (0.05 | ) | $ | 0.16 | |||||||
| Diluted: | ||||||||||||||||
| Income from continuing operations attributable to MDC | ||||||||||||||||
| Partners Inc. common shareholders | $ | 0.56 | $ | 0.35 | $ | 0.05 | $ | 0.18 | ||||||||
| Discontinued operations attributable to MDC | ||||||||||||||||
| Partners Inc. common shareholders | $ | 0.03 | $ | (0.03 | ) | $ | (0.10 | ) | $ | (0.03 | ) | |||||
| Net Income (loss) attributable to MDC Partners Inc. | ||||||||||||||||
| common shareholders | $ | 0.59 | $ | 0.32 | $ | (0.05 | ) | $ | 0.15 | |||||||
| Weighted Average Number of Common Shares Outstanding: | ||||||||||||||||
| Basic | 49,859,300 | 49,546,062 | 49,807,419 | 49,442,770 | ||||||||||||
| Diluted | 50,399,936 | 50,195,321 | 50,365,119 | 50,106,545 | ||||||||||||
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| SCHEDULE 2 | ||||||||
| MDC PARTNERS INC. | ||||||||
| UNAUDITED RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA | ||||||||
| (US$ in 000s, except percentages) | ||||||||
| For the Three Months Ended June 30, 2015 | ||||||||
| Strategic | Performance | |||||||||||||||
| Marketing | Marketing | |||||||||||||||
| Services | Services | Corporate | Total | |||||||||||||
| Revenue | $ | 270,091 | $ | 66,515 | $ | - | $ | 336,606 | ||||||||
| Net income attributable to MDC Partners Inc. | $ | 29,560 | ||||||||||||||
| Adjustments to reconcile to Operating profit (loss): | ||||||||||||||||
| Net income attributable to the noncontrolling interests | 2,841 | |||||||||||||||
| Income from discontinued operations attributable to | ||||||||||||||||
| MDC Partners Inc., net of taxes | (1,329 | ) | ||||||||||||||
| Equity in earnings of non-consolidated affiliates | (104 | ) | ||||||||||||||
| Income tax expense | 4,679 | |||||||||||||||
| Interest expense and finance charges, net | 13,183 | |||||||||||||||
| Other, net | (4,348 | ) | ||||||||||||||
| Operating profit (loss) | $ | 33,434 | $ | 16,259 | $ | (5,211 | ) | $ | 44,482 | |||||||
| margin | 12.4 | % | 24.4 | % | 13.2 | % | ||||||||||
| Additional adjustments to reconcile to Adjusted EBITDA: | ||||||||||||||||
| Depreciation and amortization | 6,492 | 5,790 | 1,725 | 14,007 | ||||||||||||
| Stock-based compensation | 4,087 | 838 | 389 | 5,314 | ||||||||||||
| Acquisition deal costs | 215 | 90 | 537 | 842 | ||||||||||||
| Deferred acquisition consideration adjustments to P&L | (2,200 | ) | (10,541 | ) | - | (12,741 | ) | |||||||||
| Profit distributions from non-consolidated affiliates | - | 176 | 112 | 288 | ||||||||||||
| Other items, net ** | - | - | (4,718 | ) | (4,718 | ) | ||||||||||
| Adjusted EBITDA * | $ | 42,028 | $ | 12,612 | $ | (7,166 | ) | $ | 47,474 | |||||||
| margin | 15.6 | % | 19.0 | % | 14.1 | % | ||||||||||
* Adjusted EBITDA is a non-GAAP measure, but as shown above it represents operating profit (loss) plus depreciation and amortization, stock-based compensation, acquisition deal costs, deferred acquisition consideration adjustments, profit distributions from affiliates, and other items.
** Other items includes both (i) one-time gains related to the former CEO's repayment to the Company for certain perquisites and expenses ($8.6 million) and (ii) legal fees and other expenses relating to the ongoing SEC investigation ($3.9 million).
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| SCHEDULE 3 |
| MDC PARTNERS INC. |
| UNAUDITED RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA |
| (US$ in 000s, except percentages) |
| For the Three Months Ended June 30, 2014 |
| Strategic | Performance | |||||||||||||||
| Marketing | Marketing | |||||||||||||||
| Services | Services | Corporate | Total | |||||||||||||
| Revenue | $ | 230,117 | $ | 69,239 | $ | - | $ | 299,356 | ||||||||
| Net income attributable to MDC Partners Inc. | $ | 16,470 | ||||||||||||||
| Adjustments to reconcile to Operating profit (loss): | ||||||||||||||||
| Net income attributable to the noncontrolling interests | 1,749 | |||||||||||||||
| Loss from discontinued operations attributable to | ||||||||||||||||
| MDC Partners Inc., net of taxes | 1,336 | |||||||||||||||
| Equity in earnings of non-consolidated affiliates | (79 | ) | ||||||||||||||
| Income tax expense | 3,376 | |||||||||||||||
| Interest expense and finance charges, net | 13,840 | |||||||||||||||
| Other, net | (7,564 | ) | ||||||||||||||
| Operating profit (loss) | $ | 35,947 | $ | 5,727 | $ | (12,546 | ) | $ | 29,128 | |||||||
| margin | 15.6 | % | 8.3 | % | 9.7 | % | ||||||||||
| Additional adjustments to reconcile to Adjusted EBITDA: | ||||||||||||||||
| Depreciation and amortization | 5,139 | 4,345 | 433 | 9,917 | ||||||||||||
| Stock-based compensation | 2,112 | 930 | 1,386 | 4,428 | ||||||||||||
| Acquisition deal costs | 441 | 202 | 341 | 984 | ||||||||||||
| Deferred acquisition consideration adjustments to P&L | 1,121 | 2,950 | - | 4,071 | ||||||||||||
| Profit distributions from non-consolidated affiliates | - | 45 | 311 | 356 | ||||||||||||
| Adjusted EBITDA * | $ | 44,760 | $ | 14,199 | $ | (10,075 | ) | $ | 48,884 | |||||||
| margin | 19.5 | % | 20.5 | % | 16.3 | % | ||||||||||
*Adjusted EBITDA is a non-GAAP measure, but as shown above it represents operating profit (loss) plus depreciation and amortization, stock-based compensation, acquisition deal costs, deferred acquisition consideration adjustments and profit distributions from affiliates.
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| SCHEDULE 4 |
| MDC PARTNERS INC. |
| UNAUDITED RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA |
| (US$ in 000s, except percentages) |
| For the Six Months Ended June 30, 2015 |
| Strategic | Performance | |||||||||||||||
| Marketing | Marketing | |||||||||||||||
| Services | Services | Corporate | Total | |||||||||||||
| Revenue | $ | 510,527 | $ | 128,301 | $ | - | $ | 638,828 | ||||||||
| Net loss attributable to MDC Partners Inc. | $ | (2,531 | ) | |||||||||||||
| Adjustments to reconcile to Operating profit (loss): | ||||||||||||||||
| Net income attributable to the noncontrolling interests | 5,221 | |||||||||||||||
| Loss from discontinued operations attributable to | ||||||||||||||||
| MDC Partners Inc., net of taxes | 4,965 | |||||||||||||||
| Equity in earnings of non-consolidated affiliates | (455 | ) | ||||||||||||||
| Income tax expense | 625 | |||||||||||||||
| Interest expense and finance charges, net | 28,160 | |||||||||||||||
| Other, net | 13,692 | |||||||||||||||
| Operating profit (loss) | $ | 52,265 | $ | 17,068 | $ | (19,656 | ) | 49,677 | ||||||||
| margin | 10.2 | % | 13.3 | % | 7.8 | % | ||||||||||
| Additional adjustments to reconcile to Adjusted EBITDA: | ||||||||||||||||
| Depreciation and amortization | 12,915 | 11,220 | 2,172 | 26,307 | ||||||||||||
| Stock-based compensation | 6,611 | 1,959 | 1,189 | 9,759 | ||||||||||||
| Acquisition deal costs | 664 | 96 | 956 | 1,716 | ||||||||||||
| Deferred acquisition consideration adjustments to P&L | (652 | ) | (9,841 | ) | - | (10,493 | ) | |||||||||
| Profit distributions from non-consolidated affiliates | 304 | 206 | 120 | 630 | ||||||||||||
| Other items, net ** | - | - | 1,044 | 1,044 | ||||||||||||
| Adjusted EBITDA * | $ | 72,107 | $ | 20,708 | $ | (14,175 | ) | 78,640 | ||||||||
| margin | 14.1 | % | 16.1 | % | 12.3 | % | ||||||||||
* Adjusted EBITDA is a non-GAAP measure, but as shown above it represents operating profit (loss) plus depreciation and amortization, stock-based compensation, acquisition deal costs, deferred acquisition consideration adjustments, profit distributions from affiliates, and other items.
** Other items includes both (i) one-time gains related to the former CEO's repayment to the Company for certain perquisites and expenses ($8.6 million) and (ii) legal fees and other expenses relating to the ongoing SEC investigation ($9.7 million).
| Page 9 |
| SCHEDULE 5 | ||||||||
| MDC PARTNERS INC. | ||||||||
| UNAUDITED RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA | ||||||||
| (US$ in 000s, except percentages) | ||||||||
| For the Six Months Ended June 30, 2014 | ||||||||
| Strategic | Performance | |||||||||||||||
| Marketing | Marketing | |||||||||||||||
| Services | Services | Corporate | Total | |||||||||||||
| Revenue | $ | 444,921 | $ | 129,289 | $ | - | $ | 574,210 | ||||||||
| Net income attributable to MDC Partners Inc. | $ | 7,624 | ||||||||||||||
| Adjustments to reconcile to Operating profit (loss): | ||||||||||||||||
| Net income attributable to the noncontrolling interests | 3,111 | |||||||||||||||
| Loss from discontinued operations attributable to | ||||||||||||||||
| MDC Partners Inc., net of taxes | 1,607 | |||||||||||||||
| Equity in earnings of non-consolidated affiliates | (142 | ) | ||||||||||||||
| Income tax expense | 3,030 | |||||||||||||||
| Interest expense and finance charges, net | 26,459 | |||||||||||||||
| Other, net | (993 | ) | ||||||||||||||
| Operating profit (loss) | $ | 59,997 | $ | 3,722 | $ | (23,023 | ) | $ | 40,696 | |||||||
| margin | 13.5 | % | 2.9 | % | 7.1 | % | ||||||||||
| Additional adjustments to reconcile to Adjusted EBITDA: | ||||||||||||||||
| Depreciation and amortization | 10,287 | 9,177 | 935 | 20,399 | ||||||||||||
| Stock-based compensation | 4,251 | 2,207 | 2,338 | 8,796 | ||||||||||||
| Acquisition deal costs | 596 | 786 | 673 | 2,055 | ||||||||||||
| Deferred acquisition consideration adjustments to P&L | 5,566 | 6,527 | - | 12,093 | ||||||||||||
| Profit distributions from non-consolidated affiliates | - | 283 | 354 | 637 | ||||||||||||
| Adjusted EBITDA * | $ | 80,697 | $ | 22,702 | $ | (18,723 | ) | $ | 84,676 | |||||||
| margin | 18.1 | % | 17.6 | % | 14.7 | % | ||||||||||
*Adjusted EBITDA is a non-GAAP measure, but as shown above it represents operating profit (loss) plus depreciation and amortization, stock-based compensation, acquisition deal costs, deferred acquisition consideration adjustments and profit distributions from affiliates.
| Page 10 |
| SCHEDULE 6 | |||||
| MDC PARTNERS INC. | |||||
| UNAUDITED ADJUSTED EBITDA AVAILABLE FOR GENERAL CAPITAL PURPOSES | |||||
| (US$ in 000s) | |||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2015 | 2014 | 2015 | 2014 | |||||||||||||
| Adjusted EBITDA (1) | $ | 47,474 | $ | 48,884 | $ | 78,640 | $ | 84,676 | ||||||||
| Net income attributable to noncontrolling interests | (2,841 | ) | (1,749 | ) | (5,221 | ) | (3,111 | ) | ||||||||
| Capital expenditures, net (2) | (3,812 | ) | (2,604 | ) | (9,112 | ) | (5,100 | ) | ||||||||
| Cash taxes | (175 | ) | (35 | ) | (715 | ) | (118 | ) | ||||||||
| Cash interest, net & other (3) | (12,893 | ) | (12,723 | ) | (25,544 | ) | (24,054 | ) | ||||||||
| Adjusted EBITDA Available for General Capital Purposes (4) | $ | 27,753 | $ | 31,773 | $ | 38,048 | $ | 52,293 | ||||||||
(1) Adjusted EBITDA is a non GAAP measure. See schedules 2 through 5 for a reconciliation of Net income (loss) to Adjusted EBITDA.
(2) Capital expenditures, net represents capital expenditures net of landlord reimbursements.
(3) Cash interest, net & other represents the quarterly accrual of cash interest under our Senior Notes.
(4) Adjusted EBITDA Available for General Capital Purposes is a non-GAAP measure, and represents funds available for repayment of debt, acquisitions, deferred acquisition consideration, dividends, and other general corporate initiatives.
| Page 11 |
| SCHEDULE 7 | ||||
| MDC PARTNERS INC. | ||||
| UNAUDITED CONSOLIDATED BALANCE SHEETS | ||||
| (US$ in 000s) | ||||
| June 30, | December 31, | |||||||
| 2015 | 2014 | |||||||
| Assets | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | 34,851 | $ | 113,348 | ||||
| Cash held in trusts | 206,098 | 6,419 | ||||||
| Accounts receivable, net | 413,964 | 355,295 | ||||||
| Expenditures billable to clients | 46,548 | 40,202 | ||||||
| Other current assets | 40,952 | 36,978 | ||||||
| Total Current Assets | 742,413 | 552,242 | ||||||
| Fixed assets, net | 59,206 | 60,240 | ||||||
| Investment in non-consolidated affiliates | 10,027 | 6,110 | ||||||
| Goodwill | 878,366 | 851,373 | ||||||
| Other intangible assets, net | 83,494 | 86,121 | ||||||
| Deferred tax assets | 19,893 | 18,758 | ||||||
| Other assets | 55,248 | 74,046 | ||||||
| Total Assets | $ | 1,848,647 | $ | 1,648,890 | ||||
| Liabilities, Redeemable Noncontrolling Interests and Shareholders' Deficit | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable | $ | 303,152 | $ | 316,285 | ||||
| Trust liability | 206,098 | 6,419 | ||||||
| Accruals and other liabilities | 364,331 | 264,854 | ||||||
| Advance billings | 156,658 | 142,608 | ||||||
| Current portion of long term debt | 515 | 534 | ||||||
| Current portion of deferred acquisition consideration | 106,334 | 90,804 | ||||||
| Total Current Liabilities | 1,137,088 | 821,504 | ||||||
| Long-term debt, less current portion | 741,780 | 742,593 | ||||||
| Long-term portion of deferred acquisition consideration | 114,533 | 114,564 | ||||||
| Other liabilities | 45,627 | 45,861 | ||||||
| Deferred tax liabilities | 83,402 | 77,997 | ||||||
| Total Liabilities | 2,122,430 | 1,802,519 | ||||||
| Redeemable Noncontrolling Interests | 148,401 | 194,951 | ||||||
| Shareholders' Deficit | ||||||||
| Common shares | 268,850 | 265,818 | ||||||
| Charges in excess of capital | (278,484 | ) | (209,668 | ) | ||||
| Accumulated deficit | (492,164 | ) | (489,633 | ) | ||||
| Accumulated other comprehensive loss | (2,152 | ) | (7,752 | ) | ||||
| MDC Partners Inc. Shareholders' Deficit | (503,950 | ) | (441,235 | ) | ||||
| Noncontrolling Interests | 81,766 | 92,655 | ||||||
| Total Shareholders' Deficit | (422,184 | ) | (348,580 | ) | ||||
| Total Liabilities, Redeemable Noncontrolling | ||||||||
| Interests and Shareholders' Deficit | $ | 1,848,647 | $ | 1,648,890 | ||||
| Page 12 |
| SCHEDULE 8 | |||
| MDC PARTNERS INC. | |||
| UNAUDITED SUMMARY CASH FLOW DATA | |||
| (US$ in 000s) | |||
| Six Months Ended June 30, | ||||||||
| 2015 | 2014 | |||||||
| Cash flows provided by continuing operating activities | $ | 69,478 | $ | 25,255 | ||||
| Discontinued operations | (995 | ) | 894 | |||||
| Net cash provided by operating activities | 68,483 | 26,149 | ||||||
| Cash flows used in continuing investing activities | (36,073 | ) | (57,186 | ) | ||||
| Discontinued operations | 18,070 | (1,145 | ) | |||||
| Net cash used in investing activities | (18,003 | ) | (58,331 | ) | ||||
| Net cash used in continuing financing activities | (129,105 | ) | (3,808 | ) | ||||
| Discontinued operations | (40 | ) | (40 | ) | ||||
| Net cash used in financing activities | (129,145 | ) | (3,848 | ) | ||||
| Effect of exchange rate changes on cash and cash equivalents | 168 | (330 | ) | |||||
| Net decrease in cash and cash equivalents | $ | (78,497 | ) | $ | (36,360 | ) | ||
| Page 13 |
