www.bankrate.com

For more information contact:

Steven D. Barnhart

SVP, Chief Financial Officer

steve.barnhart@bankrate.com

(917) 438-9558

 

 

 

FOR IMMEDIATE RELEASE

Reminder -- Conference Call and Webcast Today at 5:00 P.M. Eastern Time

Interactive Dial-In: (877) 809-9810, Passcode 47035402.   International Callers Dial-In: (330) 863-3286, Passcode 47035402(10 minutes before the call). Webcast:  http://investor.bankrate.com/

 

 

BANKRATE PRODUCES RECORD FULL-YEAR RESULTS DESPITE IMPACT OF

GOOGLE COMPARE Q4 TESTING AND LOWER DEPOSIT ADVERTISING REVENUE

CEO Highlights 2016 Investments  Positioning Company For Future Growth

 

 

 

 

 

 

NEW YORK, NY – February 24, 2016  - Bankrate, Inc. (NYSE: RATE) today reported financial results for the quarter and full year ended December 31, 2015.

 

“Bankrate generated another quarter of record revenue and strong Adjusted EBITDA. However, we fell short of our updated earnings guidance. The momentum we carried into the fourth quarter was impacted by two factors: First, during the quarter, Google tested placement of a version of its Compare service that took up more of the display on credit card-related search results. Second, deposit advertisers significantly reduced their ad budgets far beyond the anticipated 

---

 

seasonal slowdown.  On February 22, 2016, Google announced it was terminating its Compare services, including Compare Credit Cards, by March 23, 2016. We believe Google’s announcement is a positive development for Bankrate.  However, we are still assessing the impact of this announcement along with other recent changes we are seeing, including Google displaying additional paid ads on the top of many search results,” said Kenneth S. Esterow, President and CEO of Bankrate, Inc.

 

“In 2016, RATE will step up product, technology and marketing investments.  In a continuously evolving landscape, we believe these investments will keep CreditCards.com growing as the ‘go-to’ marketplace for both consumers and credit card issuers, well-beyond its leading position in organic search; reinforce Bankrate.com as a top consumer destination for personal finance information by redesigning the site and improving personalization; and enable Caring to continue adding to their network of senior living communities.  We are confident these investments are the key to return Bankrate to the level of growth that we all expect, in 2017 and beyond,” Mr. Esterow continued.

 

Fourth Quarter 2015 Business Highlights

Credit Cards

       Mobile represented 49% of CreditCards.com’s total consumer inquiries in the quarter and 22% of CreditCards.com’s total consumer inquiry revenue.

 

Banking

 

Senior Care

 

 

 

 

 

 

 

---

 

Selected Financial Metrics

 

 

 

Fourth Quarter 2015 Financial Highlights

 

A reconciliation of non-GAAP measures can be found lower in this press release and supplemental information can be found in the “Q4-15 Earnings Call Presentation” located in the “Investor Overview” section on http://investor.bankrate.com/.

 

---

 

First Quarter and Full Year 2016 Guidance

Given the recent and uncertain nature of the Google developments mentioned above, our forward visibility is limited.  Hence, our guidance is less specific and does not reflect any change in the Google search environment for the balance of the quarter. Any net benefit from changes in search  would represent upside to this quarterly guidance.    For the first quarter of 2016, the Company expects revenue greater than $80 million, with Adjusted EBITDA greater than $20 million.

 

We plan to provide full-year 2016 guidance when we announce our first quarter 2016 results, at which point we should have better visibility into the impact of these recent changes.     

 

Share Repurchase Program

In the fourth quarter the Company completed the $75 million share repurchase program announced in September 2015. 

 

Bankrate’s Board of Directors has authorized an additional $50 million share repurchase program. Under the terms of the program, the Company may repurchase up to $50 million of its outstanding common stock.  Stock repurchases under this program may be made through open market and privately negotiated transactions. The timing and amount of specific repurchases are subject to the requirements of the Securities and Exchange Commission, market conditions, alternative uses of capital and other factors.  The stock repurchase program does not obligate Bankrate to acquire any particular amount of shares and the program may be limited or terminated at any time without prior notice. The program is effective immediately and will expire on December 31, 2017. 

 

 

February 24, 2016 Conference Call Interactive Dial-In and Webcast Information:

To participate in the teleconference please dial: (877) 809-9810 and enter the passcode 47035402.  International callers should dial: (330) 863-3286 and enter the passcode 47035402.  Please access the call at least 10 minutes prior to the time the conference is set to begin. A webcast of this call can be accessed at Bankrate’s website: http://investor.bankrate.com/.

 

Replay Information:

A replay of the conference call will be available beginning February 24, 2016 at 8:00 p.m. ET / 5:00 p.m. PT through March 2, 2016 at 8:00 p.m. ET / 5:00 p.m. PT.  To listen to the replay, call (855) 859-2056 and enter the passcode: 47035402.  International callers should dial (404) 537-3406 and enter the passcode: 47035402.

 

Non-GAAP Measures:

To supplement Bankrate’s financial statements presented in accordance with generally accepted accounting principles (“GAAP”), Bankrate uses non-GAAP measures of certain components of financial performance, including EBITDA, Adjusted EBITDA and Adjusted EPS, which are adjusted from results based on GAAP to exclude certain expenses, gains and losses.  These non-GAAP measures are provided to enhance investors’ overall understanding of Bankrate’s current financial performance and its prospects for the future.  Specifically, Bankrate believes the non-GAAP results provide useful information to both management and investors by excluding certain expenses, gains and losses that may not be

---

 

indicative of its core operating results.  In addition, because Bankrate has historically reported certain non-GAAP results to investors, Bankrate believes the inclusion of non-GAAP measures provides consistency in its financial reporting. These measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. The non-GAAP measures included in this press release have been reconciled to the nearest GAAP measure in the financial tables below.

 

About Bankrate, Inc.

Bankrate is a leading online publisher, aggregator, and distributor of personal finance content.  Bankrate aggregates large scale audiences of in-market consumers by providing them with proprietary, fully researched, comprehensive, independent and objective personal finance and related editorial content across multiple vertical categories including mortgages, deposits, credit cards, senior care and other categories, such as retirement, automobile loans, and taxes.  Our flagship sites Bankrate.com,  CreditCards.com, and Caring.com are leading destinations in each of their respective verticals and connect our audience with financial service and senior care providers and other contextually relevant advertisers. Bankrate also develops and provides content, tools, web services and co-branded websites to over 100 online partners, including some of the most trusted and frequently visited personal finance sites such as Yahoo!, CNBC, AARP and Bloomberg. In addition, Bankrate licenses editorial content to leading news organizations such as The Wall Street Journal, USA Today, and The New York Times.

 

Cautionary Statement Regarding Forward Looking Statements

Certain matters included in this press release may be “forward-looking statements” which involve risks and uncertainties.  Those statements include statements regarding the intent, belief or current expectations of the Company and members of our management team.  Such forward-looking statements include, without limitation, statements made with respect to future revenue, revenue growth, market acceptance of our products, our strategy and profitability.  Investors and prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements.  We derive many of our forward-looking statements from our operating budgets and forecasts, which are based upon many detailed assumptions.  While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known or unknown factors, and it is impossible for us to anticipate all factors that could affect our actual results.  Important factors currently known to management that could cause actual results to differ materially from those in forward-looking statements include the following:  the willingness or interest of banks, lenders, brokers, credit card issuers, senior care providers and other advertisers in the business verticals in which we operate to advertise on our websites or mobile applications, or purchase our leads, clicks, calls and referrals; changes in application approval rates by our credit card issuer customers; increased competition and its effect on our website traffic, click-through rates, advertising rates, margins, and market share; our dependence on internet search engines to attract a significant portion of the visitors to our websites and our ability to diversify the sources from which we obtain visitor traffic to our websites and mobile applications, including without limitation through use of social media channels; the timing of Google’s termination of its Google Compare services or any change to its decision to terminate such services; changes by Google in the way it displays organic or paid search results; our dependence on traffic from our

---

 

partners to produce a significant portion of the company’s revenue and our ability to establish and maintain distribution arrangements; the willingness of consumers to accept the Internet and our online network as a medium for obtaining information on financial products or senior care; shift of visitors from desktop to mobile and mobile app environments; the rate of conversion of consumers’ visits to our websites or mobile applications into senior care referrals and the rate at which those referrals result in move-ins with our senior care customers; the number of consumers seeking information about the financial and senior care products we have on our websites or mobile applications; our ability to successfully execute on our strategies, and the effectiveness of our strategies and investments in our business, including without limitation whether they result in increased revenue or profitability; our ability to maintain good working relationships with our customers and third-party providers and to continue to attract new customers; risks relating to the defense or litigation of lawsuits, including the putative securities class action lawsuit currently pending and described in our SEC filings; the timing and outcome of, including potential expense associated with, and the potential impact on our business and stock price of any announcements regarding, the United States Department of Justice investigation relating to our financial reporting during 2012; the timing and outcome of, including potential expense associated with, and the potential impact on our business and stock price of any announcements regarding, the Consumer Financial Protection Bureau investigation; any delay, or failure to pay, or contractually required reduction in the deferred portion of the purchase price in connection with the sale of the Company’s Insurance business in December 2015; our ability to anticipate and manage cybersecurity risk and data security risk and to mitigate or resolve issues that may arise; the effects of any security breach, data breach or cyberattack on our systems, websites or mobile applications, or on our reputation, and the impact of any notification costs or other liability arising from any security breach, data breach or cyberattack on our business; technological changes and our ability to adapt to new or evolving technologies that affect our business environment or operations; our ability to maintain effective disclosure controls and procedures and internal control over financial reporting; our ability to manage traffic on our websites or mobile applications, and service interruptions; our ability to maintain and develop our brands and content; our indebtedness and the effect such indebtedness may have on our business; our need and our ability to obtain additional debt or equity financing; our ability to integrate the operations and realize the expected benefits of businesses that we have acquired and may acquire in the future; the effect of unexpected liabilities we assume (whether intentional or not) from our acquisitions; the effect of programmatic advertising platforms on display revenue; our ability to attract and retain executive officers and personnel; any failure or refusal by our insurance providers to provide coverage under our insurance policies; our ability to protect our intellectual property; the effects of potential liability for content on our websites or mobile applications; the effect of our operations in the United Kingdom and possible expansion to other international markets, in which we may have limited experience, and our ability to successfully execute on our business strategies in international markets; the strength of the U.S. economy in general and the financial services industry in particular; changes in monetary and fiscal policies of the U.S. government and interest rate volatility; changes in consumer spending and saving habits; review of our business and operations by regulatory or other governmental authorities; changes in laws and regulations or interpretations of laws and regulations, other changes in the legal and regulatory environment, and the impact of such changes on the operation of our business; any impairment to our goodwill and/or intangible assets; changes in accounting principles, policies, practices or guidelines; and our ability to manage the risks involved in the foregoing.  For more information about factors that could cause actual results to differ materially from our expectations, refer to our reports filed with the Securities and Exchange

---

 

Commission, including the discussion without limitation under “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2015 along with any modifications or updates to those “Risk Factors” in our Quarterly Reports on Form 10-Q.  These documents are available on the SEC’s website at www.sec.gov.  Any factor described above or in our SEC reports could, by itself or together with one or more other factors, adversely affect our financial results and condition. We caution you that the foregoing list of important factors may not contain all of the material factors that are important to you.  We undertake no obligation to publicly update or revise any forward-looking statements as a result of new information, future events or otherwise, except as otherwise required by law.

 

-Financial Statements Follow-

###

---

 

Bankrate, Inc. and Subsidiaries

Condensed Consolidated Balance Sheet

(Unaudited)

(In thousands, except share and per share data)

 

 

---

 

Bankrate, Inc. and Subsidiaries

Condensed Consolidated Statements of Income

(Unaudited)

(In thousands, except share and per share data)

 

 

 

 

 

 

 

---

 

Bankrate, Inc. and Subsidiaries

Non-GAAP Measures (Unaudited)

(In thousands, except per share data)

 

 

 

 

 

---