Marchex Reports Second Quarter 2009 Financial Results
Press Release
Source: Marchex, Inc.
On Wednesday August 5, 2009, 4:30 pm EDT
SEATTLE--(BUSINESS WIRE)--Marchex, Inc. (NASDAQ:MCHX - News), a leading local search and performance advertising company, today reported its results for the second quarter of 2009 ended June 30, 2009.
Second Quarter 2009 Consolidated Financial Results
•Revenue was $21.1 million for the second quarter of 2009, compared to $37.4 million for the same period of 2008.
•GAAP net loss applicable to common stockholders was $1.2 million for the second quarter of 2009 or $0.04 loss per diluted share. This compares to GAAP net income applicable to common stockholders of $509,000 or $0.01 per diluted share for the same period of 2008. The second quarter 2009 results included non-cash stock-based compensation expense recorded under the fair value method of $2.5 million, compared to non-cash stock-based compensation expense of $2.7 million for the same period in 2008.
•We provide a reconciliation of GAAP diluted EPS to Adjusted non-GAAP EPS in the financial tables attached to this press release and encourage investors to examine the reconciling adjustments between the GAAP and non-GAAP measures. Adjusted non-GAAP EPS for the second quarter of 2009 was $0.03, compared to $0.09 for the same period of 2008. Some Wall Street analysts use non-GAAP measures to analyze our operating results, which may include adjusted non-GAAP EPS, adjusted operating income before amortization and adjusted EBITDA. We present GAAP measures with equal or greater prominence than non-GAAP measures and such non-GAAP measures should not be considered a substitute for, or superior to, GAAP measures.
•Adjusted operating income before amortization was $1.5 million for the second quarter of 2009, compared to $5.4 million for the same period of 2008. A reconciliation of non-GAAP adjusted operating income before amortization to GAAP operating income and GAAP net income is included in the financial tables attached to this release.
•Adjusted EBITDA was $3.1 million in the second quarter of 2009, compared to $8.0 million for the same period of 2008. A reconciliation of Adjusted EBITDA to GAAP net cash provided by operating activities is included in the financial tables attached to this release.
“While we continued to confront a difficult economic environment during the second quarter, by focusing on our products, our customers’ needs and our cost structure, we continued to generate meaningful cash from our operations and win new customers,” said Russell C. Horowitz, Marchex Chairman and Chief Executive Officer. “We are reducing risks in our business and exercising financial discipline, while prudently investing in the areas key to our long-term growth. As a result, we believe Marchex is in a very good position to realize meaningful growth when the economy and advertiser budgets return to a more normalized state.”
Operating Highlights
Local Advertising Services: For the second quarter of 2009, revenue from Local Advertising Services was $14.6 million. Marchex ended the second quarter with more than 70,000 advertisers using its products and services. While it is more difficult to predict advertiser growth rates in the current economy, Marchex still expects to continue adding new advertisers in 2009.
Publishing (proprietary traffic sources): For the second quarter of 2009, revenue from Publishing was $6.5 million.
In addition, during the quarter, Marchex sold a small number of non-strategic domains that yielded approximately $900,000. There is still significant demand for high quality domains and Marchex believes that will remain the case in 2009 and beyond.
Non-Operating Highlights
During the second quarter of 2009, Marchex purchased 246,000 shares of its outstanding Class B common stock for a total price of $1 million, bringing its total shares repurchased under its stock repurchase program to 7.8 million shares, or 23% of its outstanding common stock.
Marchex Financial Guidance
“While there are some signs of stabilization in the economy, we continue to experience an uncertain economic environment that is impacting our near-term revenue outlook. Additionally, while we made significant progress in lowering our exposure to certain financially challenged customers, conversations with these customers are still ongoing. As a result, we believe it prudent to not issue guidance at this time,” said Horowitz. “Despite these factors, Marchex continues to generate cash every quarter and has no debt. We have the right strategy with the right products, and we are winning the high value advertising relationships that will enable us to fully capitalize on the local advertising opportunity and create long-term value.”
