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8-K - FORM 8-K - MONSTER WORLDWIDE, INC.d868887d8k.htm
EX-99.1 - EX-99.1 - MONSTER WORLDWIDE, INC.d868887dex991.htm

Exhibit 99.2

 

LOGO

FINANCIAL SUPPLEMENT

December 31, 2014

Monster Worldwide, Inc. (together with its consolidated subsidiaries, the “Company,” “Monster,” “we,” “our” or “us”) provides this supplement to assist investors in evaluating the Company’s financial and operating metrics. We suggest that the notes to this supplement be read in conjunction with the financial tables. The financial information included in this supplement contains certain non-GAAP financial measures. These measures should be considered in addition to results prepared in accordance with generally accepted accounting principles (“GAAP”), but are not a substitute for, or superior to, GAAP results. The non-GAAP measures included in this supplement have been reconciled to the most comparable GAAP measure. The Company intends to update the financial supplement on a quarterly basis.

 

1


LOGO

Notes to Financial Supplement

Presentation

Stock Based Compensation

Non-cash, stock-based compensation expense has been excluded from our non-GAAP financial statements for all periods presented. Effective November 4, 2014, Salvatore Iannuzzi resigned as Chief Executive Officer and President of the Company. In connection with his resignation, the Company accelerated the vesting of 160,501 RSA’s and 2,250,000 RSU’s, resulting in $4.4 million of non-cash compensation. These charges have been excluded from our non-GAAP financial statements for the three and twelve months ended December 31, 2014.

Separation Costs

During the three months ended December 31, 2014, excluding stock based compensation as discussed above, the Company incurred $5.0 million of separation charges primarily related the resignation of the Company’s former Chief Executive Officer and President, Salvatore Iannuzzi, effective November 4, 2014. These charges have been excluded from our non-GAAP financial statements for the three and twelve months ended December 31, 2014.

Facilities Costs

During the three months and twelve months ended December 31, 2014, the Company incurred $0.5 million and $7.7 million of charges associated with exited facilities, respectively, which have been excluded from our non-GAAP financial statements for the respective periods. The majority of these charges related to facility charges associated with the consolidation of multiple offices into the Company’s new corporate headquarters in Weston, Massachusetts.

Goodwill Impairment

In the fourth quarter of 2014, primarily due to the decline of our market capitalization and the implications such decline had on the carrying value of our goodwill, which resulted in higher discount rates applied to forecasted cash flows, the Company concluded that the carrying amount of goodwill exceeded its estimated fair value for both the Careers – North America and Internet Advertising & Fees segments. As a result, the Company recorded a pre-tax goodwill impairment charge of $325.8 million in the three months ended December 31, 2014 ($263.0 million, net of tax), which has been excluded from our non-GAAP financial statements for the three and twelve months ended December 31, 2014.

Strategic Alternatives

On March 1, 2012, the Company announced that it had resolved to explore strategic alternatives to maximize value for the Company’s stockholders During the year ended December 31, 2013, the Company incurred $2.9 million of costs related to the review of strategic alternatives which have been excluded from our non-GAAP financial statements.

 

2


Restructuring

On November 8, 2012, the Company announced actions to concentrate resources on core businesses within North America and key European and Asian markets with increased spending in marketing and sales. The restructuring actions included reducing the Company’s workforce, consolidating certain office facilities and impairing certain fixed assets. The Company incurred $20.0 million of restructuring costs relating to this program in the year ended December 31, 2013 which have been excluded from our non-GAAP financial statements for the twelve months ended December 31, 2013.

3.50% Convertible Senior Notes Due 2019

On October 22, 2014, the Company consummated an offering of $143.8 million aggregate principal amount of its 3.50% convertible senior notes due 2019 (the “Notes”), which includes $18.8 million in aggregate principal amount of Notes sold pursuant to the over-allotment option that was previously granted to the initial purchasers of the Notes and exercised by the initial purchasers on October 21, 2014. The Company received net proceeds of $139.0 million from the sale of the Notes, after deducting fees and expenses of $4.7 million. The Notes are unsecured, senior obligations of Monster, that bear interest at a rate of 3.50% per annum, payable in arrears on April 15 and October 15 of each year to holders of record at the close of business on the preceding April 1 and October 1, respectively. The Notes will mature on October 15, 2019, unless converted or repurchased in accordance with their terms prior to such date.

In connection with the offering of the Notes, Monster entered into capped call transactions with an affiliate of one of the initial purchasers. The Company used $16.5 million of the net proceeds to pay for the cost of the capped call transactions, $82.5 million to repay in full the term loan outstanding as of the date of issuance, and $40.0 million to repay a portion loans outstanding under the revolving credit facility.

In accordance with ASC 470-20, Debt with Conversion and Other Options, the Notes were separated into debt and equity components and assigned a fair value. The value assigned to the debt component was the estimated fair value, as of the issuance date, of similar debt without the conversion feature. The difference between the cash proceeds and this estimated fair value represents the value which was assigned to the equity component and was recorded as a debt discount. The debt discount is being amortized using the effective interest method from the date of issuance through the October 15, 2019 maturity date.

The initial debt component of the Notes was valued at $122.8 million, based on the contractual cash flows discounted at an appropriate market rate for non-convertible debt at the date of issuance. The carrying value of the permanent equity component reported in additional paid-in-capital was initially valued at $20.2 million, which is net of $0.7 million of fees and expenses allocated to the equity component.

During the three months ended December 31, 2014, the Company recognized $0.8 million of amortization of the debt discount and $0.2 million of deferred financing fees relating to the Notes which have been excluded from our non-GAAP financial statements for the three and twelve months ended December 31, 2014.

Amended Credit Facility

On October 31, 2014, the Company amended and restated the Second Amended Credit Agreement (the “Third Amended Credit Agreement”). The Third Amended Credit Agreement provides the Company with a $100 million revolving credit facility and $90 million term loan facility, providing for a total of $190 million in credit available to the Company. The borrowings under the Third Amended Credit Agreement were used to satisfy the obligations under the Second Amended Credit Agreement of $98.9 million under the revolving credit facility. Each of the revolving credit facility and the term loan facility matures on October 31, 2017. The Third Amended Credit Agreement partially qualifies as a debt extinguishment in accordance with ASC 470—Debt. Accordingly, the Company expensed $0.4 million of financing fees classified as a debt extinguishment through interest & other, net during the fourth quarter of 2014, which has been excluded from our non-GAAP financial statements for the three and twelve months ended December 31, 2014. The remaining $2.8 million of financing fees are being deferred and amortized through October 2017.

 

3


Investment and Indefinite-Lived Intangible Impairment

During the three months ended December 31, 2014, the Company recorded an impairment charge of $1.1 million related to a cost method investment. In addition, the Company recorded an impairment charge of $1.0 million on an indefinite-lived intangible asset during the same period. These charges have been excluded from our non-GAAP financial statements for the three and twelve months ended December 31, 2014.

Gain on deconsolidation of subsidiaries, net

Prior to January 3, 2014, the Company had a 25% equity investment in a company located in Finland related to a business combination completed in 2001, with the remaining 75% held by Alma Media Corporation (“Alma Media”). Alma Media is a leading media company based in Finland, focused on digital services and publishing in Finland, the Nordic countries, the Baltics and Central Europe. Effective January 3, 2014, the Company expanded its relationship with Alma Media. Monster and Alma Media each contributed several additional entities and businesses into the existing joint venture and formed a significantly larger joint venture where Monster has an equity ownership of 15% with the opportunity to increase ownership up to 20%. The Company also contributed cash of approximately $6.5 million. Following closing, Monster no longer held a controlling interest in its subsidiaries in Poland, Hungary and the Czech Republic and therefore deconsolidated those subsidiaries effective January 3, 2014. The Company accounts for its investment under the equity method of accounting due to the Company’s ability to exert significant influence over the financial and operating policies of the new joint venture, primarily through our representation on the board of directors.

The Company recorded a gain of approximately $14.0 million as a result of the deconsolidation. The gain was measured as the difference between the (a) net fair value of the retained noncontrolling investment and the consideration transferred and (b) the carrying value of the contributed subsidiaries’ net assets of approximately $4.2 million. The fair value of the retained noncontrolling investment was approximately $24.8 million which was determined based on the present value of estimated future cash flows. The Company also recognized $1.8 million of accumulated unrealized currency translation loss related to the net assets of the subsidiaries contributed by Monster.

As a result of the deconsolidation, the Company recorded a net gain of approximately $12.0 million during the first quarter of 2014 which has been excluded from our non-GAAP financial statements for the twelve months ended December 31, 2014.

Income Tax

As a result of the goodwill impairment recognized in the fourth quarter of 2014, the Company recognized a tax benefit of $62.8 million which has been excluded from our non-GAAP financial statements for the three and twelve months ended December 31, 2014.

As a result of the gain related to the deconsolidation of our subsidiaries in Poland, Hungary and the Czech Republic, the Company recognized a tax provision of $5.5 million in the first quarter of 2014 which has been excluded from our non-GAAP financial statements for the twelve months ended December 31, 2014.

In the fourth quarter of 2013, the Company recognized a tax provision relating to the sale of a noncontrolling interest in our South Korean subsidiary which has been excluded from our non-GAAP financial statements for the three and twelve months ended December 31, 2013. In the first quarter of 2013, the Company recognized an income tax benefit relating to the reversal of uncertain tax positions which has been excluded from our non-GAAP financial statements for the twelve months ended December 31, 2013.

Discontinued Operations

During the third quarter of 2012, as part of the Company’s review of strategic alternatives, the Company made the decision to sell its Careers-China business. The sale of the Careers-China business to Saongroup, Ltd. (“Saongroup”) was completed on February 5, 2013. The Company received a 10% minority interest in the combined China business of Saongroup.

 

4


Prior to the close of the sale of Careers-China in the first quarter of 2013, the Company incurred charges relating to severance benefits associated with terminated employees, retention benefits for employees who remained with the combined operations and certain lease obligation costs. At February 5, 2013, there was $23.1 million of accumulated unrealized currency translation gain related to the net assets of Careers-China. With the sale of Careers-China on February 5, 2013, the Company recorded the foreign currency translation adjustment as a reduction of the loss on disposition of discontinued operations. On October 25, 2013, the Company received $1.8 million of funds previously held in escrow relating to the sale of Careers-China, which the Company recorded as a gain in the consolidated statements of operations in the year ended December 31, 2013. Additionally, the Company recorded a tax benefit of $4.9 million in the year ended December 31, 2013. Accordingly, the Company recorded a loss from discontinued operations related to Careers-China, net of tax, of $1.7 million in the year ended December 31, 2013. These charges have been excluded from our non-GAAP financial statements for the twelve months ended December 31, 2013. The Company does not expect to incur significant additional charges in future periods relating to Careers-China.

During the fourth quarter of 2012, the Company made the strategic decision to discontinue operations in Latin America and Turkey. All of the Latin America and Turkey business operations were discontinued on or before December 31, 2012. The Company incurred approximately $8.0 million of costs associated with the shutdown of these businesses in the fourth quarter of 2012. For the year ended December 31, 2013, the Company recorded additional costs of $3.6 million which was primarily relating to severance costs associated with terminated employees of our operations in Latin America and Turkey. Additionally, the Company recorded a tax benefit of $1.5 million for the year ended December 31, 2013. Accordingly, the Company recorded a loss from discontinued operations, net of tax, of $2.1 million in the year ended December 31, 2013. These charges have been excluded from our non-GAAP financial statements for the twelve months ended December 31, 2013. The Company does not expect to incur significant additional charges in future periods relating to Latin America or Turkey.

Reclassifications

Certain reclassifications of prior year amounts have been made for consistent presentation.

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 (“GAAP”) and may be different from non-GAAP measures reported by other companies. The Company believes that its presentation of non-GAAP measures provides useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations.

Non-GAAP revenue, operating expenses, operating (loss) income, operating margin, (loss) income from continuing operations, loss from discontinued operations, net of tax, and diluted (loss) earnings per share attributable to Monster Worldwide, Inc. all exclude certain proforma adjustments including: non-cash stock based compensation expense; costs incurred in connection with the Company’s restructuring programs; non-cash impairment charges; amortization of the debt discount and deferred financing costs associated with our 3.50% convertible senior notes due 2019; write-off of deferred financing costs relating to our former credit facility, amended in October 2014; severance charges primarily associated with the resignation of our former Chief Executive Officer, effective November 4, 2014; costs incurred related to the Company’s review of strategic alternatives; income tax benefits associated with the reversal of income tax reserves on uncertain tax positions and a tax benefit related to certain losses arising from the Company’s restructuring programs; income tax provisions for increased valuation allowances on deferred tax assets; income tax provision related to the sale of a noncontrolling interest; income tax benefit associated with goodwill impairment; the results of the businesses in Careers – China, Latin America and Turkey as they have been classified as discontinued operations; gain on deconsolidation of subsidiaries, net; and charges related to exited facilities. The Company uses these Non-GAAP measures for reviewing the ongoing results of the Company’s core business operations and in certain instances, for measuring performance under certain of the Company’s incentive compensation plans. These Non-GAAP measures may not be comparable to similarly titled measures reported by other companies.

 

5


Earnings before interest, taxes, depreciation and amortization (“EBITDA”) is defined as operating income or loss before depreciation and amortization, non-cash compensation expense, non-cash impairment charges, and non-cash costs incurred in connection with the Company’s restructuring programs. Adjusted EBITDA excludes the impact of the pro-forma adjustments discussed above. The Company considers EBITDA and Adjusted EBITDA to be an important indicator of its operational strength which the Company believes is useful to management and investors in evaluating its operating performance. EBITDA and Adjusted EBITDA are non-GAAP measures and may not be comparable to similarly titled measures reported by other companies.

Free cash flow is defined as cash flow from operating activities less capital expenditures. Free cash flow is considered a liquidity measure and provides useful information about the Company’s ability to generate cash after investments in property and equipment. Free cash flow reflected herein is a non-GAAP measure and may not be comparable to similarly titled measures reported by other companies. Free cash flow does not reflect the total change in the Company’s cash position for the period and should not be considered a substitute for such a measure.

Net cash and securities are defined as cash and cash equivalents plus short-term and long-term marketable securities, less total debt. Total available liquidity is defined as cash and cash equivalents, plus short-term and long-term marketable securities, plus unused borrowings under our credit facility as amended and restated in October 2014. The Company considers net cash and securities and total available liquidity to be important measures of liquidity and indicators of its ability to meet its ongoing obligations. The Company also uses net cash and securities and total available liquidity, among other measures, in evaluating its choices for capital deployment. Net cash and securities and total available liquidity are presented herein as non-GAAP measures and may not be comparable to similarly titled measures used by other companies.

 

6


Monster Worldwide, Inc.

Statements of Operations

(unaudited, in thousands, except per share amounts)

 

    Trended Data  

Summary P&L Information

  Q1 2013     Q2 2013     Q3 2013     Q4 2013     FY 2013     Q1 2014     Q2 2014     Q3 2014     Q4 2014     FY 2014  

Monster Careers

  $ 193,654      $ 181,819      $ 178,737      $ 180,687      $ 734,897      $ 182,251      $ 178,581      $ 175,028      $ 170,150      $ 706,010   

Internet Advertising & Fees

    18,332        18,239        18,080        18,031        72,682        15,898        15,860        16,192        16,053        64,003   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revenue

    211,986        200,058        196,817        198,718        807,579        198,149        194,441        191,220        186,203        770,013   

Salary and related

    90,781        83,997        88,030        91,207        354,015        93,826        94,157        93,905        95,898        377,786   

Office and general

    35,028        36,537        36,997        37,679        146,241        42,688        37,296        39,992        38,355        158,331   

Marketing and promotion

    49,267        43,394        38,089        38,840        169,590        41,413        37,377        35,109        32,493        146,392   

Restructuring and other special charges

    13,167        6,828        —          —          19,995        —          —          —          —          —     

Goodwill Impairment

    —          —          —          —          —          —          —          —          325,800        325,800   

Depreciation expense

    13,000        12,644        12,297        11,981        49,922        11,885        11,217        11,548        11,369        46,019   

Stock-based compensation

    6,794        5,470        4,901        8,226        25,391        8,173        9,063        6,682        11,439        35,357   

Amortization of intangibles

    3,104        3,081        2,248        801        9,234        634        618        646        726        2,624   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating expenses

    211,141        191,951        182,562        188,734        774,388        198,619        189,728        187,882        516,080        1,092,309   

Operating income (loss)

    845        8,107        14,255        9,984        33,191        (470     4,713        3,338        (329,877     (322,296

Gain on deconsolidation of subsidiaries, net

    —          —          —          —          —          11,828        —          —          —          11,828   

Interest and other, net

    (1,268     (1,357     (1,482     (1,663     (5,770     (1,323     (1,660     (1,830     (3,739     (8,552
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

(Loss) Income before income taxes and equity interests

    (423     6,750        12,773        8,321        27,421        10,035        3,053        1,508        (333,616     (319,020

(Benefit from) provision for income taxes

    (11,999     2,366        4,480        28,157        23,004        6,663        1,615        1,934        (45,503     (35,291

(Loss) income in equity interests, net

    (458     (245     (119     (86     (908     (133     58        75        (78     (78
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) from continuing operations

    11,118        4,139        8,174        (19,922     3,509        3,239        1,496        (351     (288,191     (283,807

(Loss) income from discontinued operations, net of tax

    (6,134     (759     3,095        —          (3,798     —          —          —          —          —     
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

    4,984        3,380        11,269        (19,922     (289     3,239        1,496        (351     (288,191     (283,807

Net income attributable to noncontrolling interest

    —          —          —          (193     (193     (1,174     (1,462     (1,318     (1,528     (5,482
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) attributable to Monster Worldwide, Inc.

  $ 4,984      $ 3,380      $ 11,269      $ (20,115   $ (482   $ 2,065      $ 34      $ (1,669   $ (289,719   $ (289,289
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Basic earnings (loss) per share attributable to Monster Worldwide, Inc.:

                   

Income (loss) from continuing operations

    0.10        0.04        0.08        (0.21     0.03        0.02        —          (0.02     (3.31     (3.29

(Loss) income from discontinued operations, net of tax

    (0.06     (0.01     0.03        —          (0.04     —          —          —          —          —     
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

  $ 0.04      $ 0.03      $ 0.11      $ (0.21   $ —        $ 0.02      $ —        $ (0.02   $ (3.31   $ (3.29
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Diluted earnings (loss) per share attributable to Monster Worldwide, Inc.:

                   

Income (loss) from continuing operations

    0.10        0.04        0.08        (0.21     0.03        0.02        —          (0.02     (3.31     (3.29

(Loss) income from discontinued operations, net of tax

    (0.06     (0.01     0.03        —          (0.04     —          —          —          —          —     
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

  $ 0.04      $ 0.03      $ 0.11      $ (0.21   $ —        $ 0.02      $ —        $ (0.02   $ (3.31   $ (3.29
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Weighted avg. shares outstanding:

                   

Basic shares

    111,402        110,932        105,394        97,872        106,947        91,102        87,080        86,576        87,478        88,045   

Diluted shares

    112,637        111,937        105,967        97,872        107,913        94,416        89,955        86,576        87,478        88,045   

Global employees - continuing operations (ones)

    3,852        3,905        3,948        3,998        3,998        4,068        4,078        4,067        4,091        4,091   

Annualized revenue per average employee

  $ 215.0      $ 206.3      $ 200.5      $ 200.1      $ 205.5      $ 196.5      $ 191.0      $ 187.8      $ 182.6      $ 189.5   


Monster Worldwide, Inc.

Non-GAAP Statements of Operations

(Unaudited, in thousands, except for per share amounts)

 

    Trended Data  

Summary P&L Information

  Q1 2013     Q2 2013     Q3 2013     Q4 2013     FY 2013     Q1 2014     Q2 2014     Q3 2014     Q4 2014     FY 2014  

Monster Careers

  $ 193,654      $ 181,819      $ 178,737      $ 180,687      $ 734,897      $ 182,251      $ 178,581      $ 175,028      $ 170,150      $ 706,010   

Internet Advertising & Fees

    18,332        18,239        18,080        18,031        72,682        15,898        15,860        16,192        16,053        64,003   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Revenue

    211,986        200,058        196,817        198,718        807,579        198,149        194,441        191,220        186,203        770,013   

Salary and related

    90,781        83,997        88,030        91,207        354,015        93,826        94,157        93,905        90,924        372,812   

Office and general

    33,653        34,992        36,997        37,679        143,321        36,339        37,296        39,112        36,855        149,602   

Marketing and promotion

    49,267        43,394        38,089        38,840        169,590        41,413        37,377        35,109        32,493        146,392   

Depreciation expense

    13,000        12,644        12,297        11,981        49,922        11,885        11,217        11,548        11,369        46,019   

Amortization of intangibles

    3,104        3,081        2,248        801        9,234        634        618        646        726        2,624   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating expenses

    189,805        178,108        177,661        180,508        726,082        184,097        180,665        180,320        172,367        717,449   

Operating income

    22,181        21,950        19,156        18,210        81,497        14,052        13,776        10,900        13,836        52,564   

Interest and other, net

    (1,268     (1,357     (1,482     (1,663     (5,770     (1,323     (1,660     (1,830     (1,378     (6,191
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income before income taxes and equity interests

    20,913        20,593        17,674        16,547        75,727        12,729        12,116        9,070        12,458        46,373   

Provision for income taxes

    7,320        7,222        6,199        5,791        26,532        4,083        3,756        3,175        4,365        15,379   

(Loss) income in equity interests, net

    (458     (245     (119     (86     (908     (133     58        75        (78     (78
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income

    13,135        13,126        11,356        10,670        48,287        8,513        8,418        5,970        8,015        30,916   

Net income attributable to noncontrolling interest

    —          —          —          (193     (193     (1,174     (1,462     (1,318     (1,528     (5,482
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income from continuing operations attributable to Monster Worldwide, Inc.

  $ 13,135      $ 13,126      $ 11,356      $ 10,477      $ 48,094      $ 7,339      $ 6,956      $ 4,652      $ 6,487      $ 25,434   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Diluted earnings per share attributable to Monster Worldwide, Inc.

  $ 0.12      $ 0.12      $ 0.11      $ 0.11      $ 0.45      $ 0.08      $ 0.08      $ 0.05      $ 0.07      $ 0.28   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Weighted avg. shares outstanding:

                   

Basic shares

    111,402        110,932        105,394        97,872        106,947        91,102        87,080        86,576        87,478        88,045   

Diluted shares

    112,637        111,937        105,967        98,655        107,913        94,416        89,955        89,317        90,664        91,091   


Monster Worldwide, Inc.

Segment Information and Margin Analysis - GAAP and Non-GAAP

(unaudited, in thousands)

 

    Trended Data  
    Q1 2013     Q2 2013     Q3 2013     Q4 2013     FY 2013     Q1 2014     Q2 2014     Q3 2014     Q4 2014     FY 2014  

Segment Revenue:

                   

Careers - North America

  $ 115,935      $ 109,717      $ 109,622      $ 111,000      $ 446,274      $ 111,647      $ 110,301      $ 108,565      $ 106,433      $ 436,946   

Careers - International

    77,719        72,102        69,115        69,687        288,623        70,604        68,280        66,463        63,717        269,064   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Careers Revenue

    193,654        181,819        178,737        180,687        734,897        182,251        178,581        175,028        170,150        706,010   

Internet Advertising & Fees Revenue

    18,332        18,239        18,080        18,031        72,682        15,898        15,860        16,192        16,053        64,003   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Monster Revenue

  $ 211,986      $ 200,058      $ 196,817      $ 198,718      $ 807,579      $ 198,149      $ 194,441      $ 191,220      $ 186,203      $ 770,013   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Segment operating income (loss): GAAP

                   

Careers - North America

  $ 12,423      $ 19,272      $ 16,346      $ 16,968      $ 65,009      $ 12,120      $ 17,902      $ 18,310      $ (246,626   $ (198,294

Careers - International

    (8,991     (6,054     (325     (3,226     (18,596     (5,289     (6,974     (7,551     (5,315     (25,129
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Careers operating income GAAP

    3,432        13,218        16,021        13,742        46,413        6,831        10,928        10,759        (251,941     (223,423

Internet Advertising & Fees operating income GAAP

    6,262        6,312        5,902        6,016        24,492        3,691        3,464        3,442        (59,221     (48,624
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Monster operating income

  $ 9,694      $ 19,530      $ 21,923      $ 19,758      $ 70,905      $ 10,522      $ 14,392      $ 14,201      $ (311,162   $ (272,047
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Corporate expenses GAAP

    (8,849     (11,423     (7,668     (9,774     (37,714     (10,992     (9,679     (10,863     (18,715     (50,249
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Monster Consolidated operating income (loss) GAAP

  $ 845      $ 8,107      $ 14,255      $ 9,984      $ 33,191      $ (470   $ 4,713      $ 3,338      $ (329,877   $ (322,296
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Segment operating income (loss)(1): Non-GAAP

                   

Careers - North America

  $ 22,424      $ 22,277      $ 17,902      $ 20,315      $ 82,918      $ 17,508      $ 21,058      $ 20,814      $ 19,978      $ 79,358   

Careers - International

    (1,747     (1,674     1,281        (2,795     (4,935     (3,130     (4,512     (5,556     (2,879     (16,077
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Careers operating income Non-GAAP

    20,677        20,603        19,183        17,520        77,983        14,378        16,546        15,258        17,099        63,281   

Internet Advertising & Fees operating income Non-GAAP

    6,883        6,978        6,353        6,753        26,967        4,415        3,922        3,803        3,943        16,083   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Monster operating income Non-GAAP

  $ 27,560      $ 27,581      $ 25,536      $ 24,273      $ 104,950      $ 18,793      $ 20,468      $ 19,061      $ 21,042      $ 79,364   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Corporate expenses Non-GAAP

    (5,379     (5,631     (6,380     (6,063     (23,453     (4,741     (6,692     (8,161     (7,206     (26,800
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Monster Consolidated operating income Non-GAAP

  $ 22,181      $ 21,950      $ 19,156      $ 18,210      $ 81,497      $ 14,052      $ 13,776      $ 10,900      $ 13,836      $ 52,564   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

(1) - See notes to financial supplement for further explanation of Non-GAAP measures.


Monster Worldwide, Inc.

Reconciliation of Operating Income to EBITDA and Adjusted EBITDA

(unaudited, in thousands)

 

    Trended Data  

Summary P&L Information

  Q1 2013     Q2 2013     Q3 2013     Q4 2013     FY 2013     Q1 2014     Q2 2014     Q3 2014     Q4 2014     FY 2014  

Revenue

  $ 211,986      $ 200,058      $ 196,817      $ 198,718      $ 807,579      $ 198,149      $ 194,441      $ 191,220      $ 186,203      $ 770,013   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating income (loss) - GAAP

  $ 845      $ 8,107      $ 14,255      $ 9,984      $ 33,191      $ (470   $ 4,713      $ 3,338      $ (329,877   $ (322,296
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Depreciation expense

    13,000        12,644        12,297        11,981        49,922        11,885        11,217        11,548        11,369        46,019   

Stock-based compensation

    6,794        5,470        4,901        8,226        25,391        8,173        9,063        6,682        11,439        35,357   

Goodwill impairment

    —          —          —          —          —          —          —          —          325,800        325,800   

Restructuring non-cash charges and other

    775        4,540        —          —          5,315        —          —          —          1,000        1,000   

Amortization of intangibles

    3,104        3,081        2,248        801        9,234        634        618        646        726        2,624   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA (1)

  $ 24,518      $ 33,842      $ 33,701      $ 30,992      $ 123,053      $ 20,222      $ 25,611      $ 22,214      $ 20,457      $ 88,504   

Separation costs

    —          —          —          —          —          —          —          —          4,974        4,974   

Facility costs

    —          —          —          —          —          6,349        —          880        500        7,729   

Fees associated with strategic alternatives

    1,375        1,545        —          —          2,920        —          —          —          —          —     

Restructuring expenses, less non-cash items

    12,392        2,288        —          —          14,680        —          —          —          —          —     
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Non-GAAP Adjustments

    13,767        3,833        —          —          17,600        6,349        —          880        5,474        12,703   

Adjusted EBITDA (1)

  $ 38,285      $ 37,675      $ 33,701      $ 30,992      $ 140,653      $ 26,571      $ 25,611      $ 23,094      $ 25,931      $ 101,207   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

(1) - See notes to financial supplement for further explanation of Non-GAAP measures.


Monster Worldwide, Inc.

Statements of Cash Flows

(unaudited, in thousands)

 

    Trended Data  
    Q1 2013     Q2 2013     Q3 2013     Q4 2013     FY 2013     Q1 2014     Q2 2014     Q3 2014     Q4 2014     FY 2014  

Cash flows (used for) provided by operating activities:

                   

Net income (loss)

  $ 4,984      $ 3,380      $ 11,269      $ (19,922   $ (289   $ 3,239      $ 1,496      $ (351   $ (288,191   $ (283,807
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjustments to reconcile net income (loss) to cash (used for) provided by operating activities:

                   

Depreciation and amortization

    16,104        15,725        14,545        12,782        59,156        12,519        11,835        12,194        12,095        48,643   

Provision for doubtful accounts

    535        897        318        617        2,367        316        412        562        417        1,707   

Stock-based compensation

    6,794        5,470        4,901        8,226        25,391        8,173        9,063        6,682        11,439        35,357   

Deferred income taxes

    (2,172     (435     4,825        26,356        28,574        3,893        (491     53        (46,873     (43,418

Non-cash restructuring charges and other

    775        4,540        —          —          5,315        —          —          —          —          —     

Impairment of investment and indefinite lived intangible

    —          —          —          —          —          —          —          —          2,070        2,070   

Goodwill Impairment

    —          —          —          —          —          —          —          —          325,000        325,000   

Loss (income) in equity interests, net

    458        245        119        86        908        133        (58     (75     78        78   

Gain on deconsolidation of subsidiaries

    —          —          —          —          —          (13,647     —          —          —          (13,647

Tax benefit from change in uncertain tax positions

    (12,869     —          (1,486     —          (14,355     —          —          —          —          —     

Amount reclassified from accumulated other comprehensive income

    (23,109     —          —          —          (23,109     1,819        —          —          —          1,819   

Excess income tax benefit from equity compensation plans

    —          (2,044     (1,970     (1,893     (5,907     (130     (69     —          —          (199

Changes in assets and liabilities, net of acquisitions:

                   

Accounts receivable

    5,907        22,734        12,820        (33,443     8,018        14,501        25,023        25,832        (24,789     40,567   

Prepaid and other

    14,690        865        (3,371     2,389        14,573        (14,838     6,848        (2,855     (863     (11,708

Deferred revenue

    (5,039     (26,203     (16,582     25,635        (22,189     (964     (26,525     (29,483     24,256        (32,716

Accounts payable, accrued liabilities, and other

    (15,695     (9,771     (23,137     3,972        (44,631     3,893        (2,634     (622     12,372        13,009   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total adjustments

    (13,621     12,023        (9,018     44,727        34,111        15,668        23,404        12,288        315,202        366,562   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash (used for) provided by operating activities

    (8,637     15,403        2,251        24,805        33,822        18,907        24,900        11,937        27,011        82,755   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Cash flows used for investing activities:

                   

Capital expenditures

    (9,149     (9,239     (6,602     (7,626     (32,616     (10,700     (11,769     (8,287     (9,087     (39,843

Payments for acquisitions, net of cash acquired

    —          —          —          —          —          (27,005     —          —          —          (27,005

Investment in Alma Career Oy

    —          —          —          —          —          (6,516     —          —          —          (6,516

Cash funded to and dividends received from equity investee and other

    623        (484     (2,638     (3,767     (6,266     (729     113        (606     (941     (2,163

Capitalized patent defense costs

    —          —          —          —          —          —          (1,220     (1,742     (1,577     (4,539
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash used for investing activities

    (8,526     (9,723     (9,240     (11,393     (38,882     (44,950     (12,876     (10,635     (11,605     (80,066
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Cash flows provided by (used for) financing activities:

                   

Proceeds from borrowings on credit facilities

    17,500        —          52,000        —          69,500        78,800        —          1,500        66,100        146,400   

Payments on borrowings on credit facilities

    (11,399     (28,400     —          (51,800     (91,599     —          (8,100     —          (184,200     (192,300

Proceeds from borrowings on term loan

    —          —          —          —          —          —          —          —          90,000        90,000   

Payments on borrowings on term loan

    (1,250     (1,875     (1,875     (1,875     (6,875     (1,875     (2,500     (2,500     (84,750     (91,625

Proceeds from Convertible notes

    —          —          —          —          —          —          —          —          143,750        143,750   

Fees paid on the issuance of debt and purchase of capped call

    —          —          —          —          —          —          —          —          (23,111     (23,111

Tax withholdings related to net share settlements of restricted stock awards and units

    (1,793     (3,194     (927     (147     (6,061     (1,427     (2,280     (1,307     (5,551     (10,565

Repurchase of common stock

    —          (23,378     (37,404     (46,385     (107,167     (39,653     (11,864     (553     —          (52,070

Excess income tax benefit from equity compensation plans

    —          2,044        1,970        1,893        5,907        130        69        —          —          199   

Net proceeds from sale of noncontrolling interest

    —          —          —          86,523        86,523        —          —          —          —          —     

Dividend paid to noncontrolling interest

    —          —          —          —          —          —          (3,021     —          —          (3,021
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by (used for) financing activities

    3,058        (54,803     13,764        (11,791     (49,772     35,975        (27,696     (2,860     2,238        7,657   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Effects of exchange rates on cash

    (3,172     (2,452     837        15        (4,772     118        1,436        (2,461     (3,723     (4,630

Net (decrease) increase in cash and cash equivalents

    (17,277     (51,575     7,612        1,636        (59,604     10,050        (14,236     (4,019     13,921        5,716   

Cash and cash equivalents, beginning of period

    148,185        130,908        79,333        86,945        148,185        88,581        98,631        84,395        80,376        88,581   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Cash and cash equivalents, end of period

  $ 130,908      $ 79,333      $ 86,945      $ 88,581      $ 88,581      $ 98,631      $ 84,395      $ 80,376      $ 94,297      $ 94,297   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 


Monster Worldwide, Inc.

Consolidated Condensed Balance Sheets

(unaudited, in thousands)

 

    Trended Data  
    March 2013     June 2013     September 2013     December 2013     March 2014     June 2014     September 2014     December 2014  
ASSETS                

Current assets:

               

Cash and cash equivalents

  $ 130,908      $ 79,333      $ 86,945      $ 88,581      $ 98,631      $ 84,395      $ 80,376      $ 94,297   

Accounts receivable, net

    333,174        309,064        298,823        332,675        318,615        293,732        262,434        282,523   

Prepaid and other

    75,229        73,853        73,801        82,809        92,717        88,127        87,353        83,326   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total current assets

    539,311        462,250        459,569        504,065        509,963        466,254        430,163        460,146   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Property and equipment, net

    137,998        132,393        128,409        124,169        126,232        126,345        121,461        119,729   

Goodwill

    880,715        873,166        891,623        895,518        918,672        915,024        891,870        540,621   

Intangibles, net

    29,385        26,096        24,219        24,058        27,849        29,186        31,327        30,503   

Investment in unconsolidated affiliates

    170        229        150        220        24,584        23,759        22,690        20,700   

Other assets

    38,644        41,078        39,960        38,227        35,496        36,697        37,355        45,452   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total assets

  $ 1,626,223      $ 1,535,212      $ 1,543,930      $ 1,586,257      $ 1,642,796      $ 1,597,265      $ 1,534,866      $ 1,217,151   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
LIABILITIES AND STOCKHOLDERS’ EQUITY                

Current liabilities:

               

Accounts payable, accrued expenses and other

  $ 186,142      $ 175,335      $ 151,778      $ 166,257      $ 165,535      $ 160,121      $ 152,965      $ 158,759   

Deferred revenue

    356,468        329,492        315,645        342,156        341,947        315,786        281,039        300,724   

Current portion of long-term debt

    7,500        8,125        8,750        9,375        212,200        201,600        10,000        9,563   

Current liabilities of discontinued operations

    3,771        2,522        2,137        1,049        735        492        378        268   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total current liabilities

    553,881        515,474        478,310        518,837        720,417        677,999        444,382        469,314   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Long-term income taxes payable

    51,255        52,590        51,298        53,078        54,451        55,355        56,465        54,636   

Long-term debt, net, less current portion

    161,600        130,700        180,200        125,900        —          —          190,600        201,821   

Other liabilities

    8,352        8,994        5,752        44,297        53,527        57,146        59,219        16,635   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total liabilities

    775,088        707,758        715,560        742,112        828,395        790,500        750,666        742,406   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Common stock and class B common stock

    141        141        142        142        142        142        143        144   

Additional paid-in capital

    1,962,039        1,970,025        1,976,768        2,003,394        2,011,447        2,019,350        2,026,324        2,040,209   

Accumulated other comprehensive income

    50,163        41,024        62,046        63,368        67,691        61,916        35,685        9,245   

Accumulated deficit

    (559,405     (556,025     (544,756     (564,871     (562,806     (562,772     (564,441     (854,160

Treasury stock, at cost

    (601,803     (627,711     (665,830     (712,362     (753,873     (768,050     (769,676     (774,940

Noncontrolling interest

    —          —          —          54,474        51,800        56,179        56,165        54,247   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total stockholders’ equity

    851,135        827,454        828,370        844,145        814,401        806,765        784,200        474,745   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total liabilities and stockholders’ equity

  $ 1,626,223      $ 1,535,212      $ 1,543,930      $ 1,586,257      $ 1,642,796      $ 1,597,265      $ 1,534,866      $ 1,217,151   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Memo(1)

               

- Net cash (debt)

  $ (38,192   $ (59,492   $ (102,005   $ (46,694   $ (113,569   $ (117,205   $ (120,224   $ (117,088

(1) - See notes to financial supplement for definitions and calculations of selected financial metrics.